$200 Oil Prices: Fact or Fiction?

Fact: U.S. oil production this past July was 7.5 million barrels per day. That's the highest monthly output since 1991. It's now believed that in the U.S. oil production could exceed imports by October, which would be the first time since 1995. Production growth is being fueled by places such as the Eagle Ford Shale in Texas, where ConocoPhillips (NYSE: COP  ) , for example, saw its production skyrocket by 98% in the past year.

Despite booming production, oil prices are stubbornly high, and currently well over $100 per barrel. Globally, cracks are being felt in the world oil markets as turmoil in Egypt has oil traders nervous. Meanwhile, global oil giant ExxonMobil (NYSE: XOM  )  for example, actually saw its production drop by 1.9% over the previous year, which, given its size, is a massive amount of oil. Despite spending billions, it simply cannot grow its oil production. 

It is this great dichotomy that has many wondering what to make of oil prices. The following slide show sheds some light on the future of oil and answers the question of whether $200 oil is fact or fiction. 

Make no mistake about it: The days of cheap oil are gone. And that will make a lot of investors rich. We'd like you to join them, which is why our top analysts have prepared an exclusive free report revealing three stocks that are bound to soar along with the price of oil. You can discover the identities of these stocks simply by clicking here now.


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  • Report this Comment On August 25, 2013, at 6:08 PM, mikeflores2000 wrote:

    Why won't Fool admit Peak Oil is here?

    Irrefutable evidence smack in our face or do we

    need a baseball bat to wake up?

    Shale IS a game changer from cheap energy

    to expensive energy: EROEI is the key.

    We are addicted to returns of 100:1 but today

    endure 5:1 at $100 per barrel which is the floor

    to maintain our modern civilization and toilets running. Talking about #hit hitting the fan:)

  • Report this Comment On August 25, 2013, at 7:16 PM, TelsaRowe wrote:

    Peak Oil is as phony as a $3 bill. And quite frankly, oil will be a thing of the past and near useless in 10 years anyway. Anyone believing in "peak oil" is a blind fool who fell for opec and the oil industry's propaganda like a good little sheep. Peak Oil is what they need fools to believe in to keep the prices above $70 which they should not be.

  • Report this Comment On August 26, 2013, at 10:33 AM, ryanalexanderson wrote:

    ...aaaand these two comments above pretty much sum up the quality of the peak oil debate. Baseball bats and sheep included.

    Slight props to the first comment, though, for at least mentioning EROEI.

  • Report this Comment On August 27, 2013, at 4:25 AM, mrplow2000 wrote:

    The shale phenomenon has pretty much blown peak oil out the water.

    Anyone who thinks oil will be a thing of the past must be expecting some seriously rapid changes in our currently lifestyle and infrastructure!

    $200 oil is inevitable with inflation and rising exploration/ development costs, that doesn't mean the additional $100 will be pure profit!!

  • Report this Comment On August 28, 2013, at 8:01 PM, LauraKearns wrote:

    The problem isn't whether or not there is enough oil - it's whether there is enough affordable oil. $100 per barrel of oil roughly translates to a price between $3.50 and $4.00 per gallon for gasoline. $200 per barrel translates to around $7.00 - $8.00 per gallon of gas. Because oil is a global commodity and its price is affected by many uncontrollable factors, its price will continue to rise, hurting consumers and the economy.

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4/17/2014 4:00 PM
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