Oil: Why it won’t go below $60

Now that OPEC has tasted record high prices with little impact on demand, some say the cartel won’t let crude fall too far – at least for now.

NEW YORK (CNNMoney.com) — Just a couple of years back people talked about oil hitting a low of $20 a barrel.

Then, as prices steadily rose without curbing worldwide demand and OPEC abandoned its target price range of $20 to $28 a barrel, people said oil wouldn’t go below $40.

Now, as budgets in oil producing countries grow fat off windfall profits and worldwide demand remains unabated, some are saying that OPEC won’t, at least in the short term, let the price of crude fall any lower than $60.

But the cartel, which like the provider of any good must balance desire for profit against the need to keep its product popular, must watch both prices and demand as the cost of oil heads toward uncharted territory.

CNN/Money