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Wednesday, January 02, 2008

Oil Hits $100 per Barrel as We Welcome in 2008

It's finally happened: $100-per-barrel oil is no longer some looming specter, just a dark possibility used by Peak Oilers to frighten little chillun's into driving less.

As we welcome in 2008, the specter of $100 oil has gone from pernicious possibility to fact-of-life reality as oil prices touched $100 per barrel today on NYMEX.

Of course, oil prices didn't stay at $100 for long before the fell back into the "comfortable" $90s.

But consider this: when this blog started in summer 2005, oil prices were trading around $55 dollars, already up about 100% from the $20-30 price range oil hovered at between 2000-2004.

2006 started with oil prices trading around $60/barrel and by the beginning of 2007, prices had topped $75 before falling back down to around $60 to welcome in the new year.

Of course, the brief fall in prices would be just that - brief - and oil prices climbed steadily in 2007, inching towards record-setting heights seemingly every day.

On October 19th, 2007, oil prices topped the $90-per-barrel mark for the first time in history before falling back into the $80s. Crude oil prices jumped by 28 percent just between August and October 2007.

By year's end, $90-per-barrel oil seemed pretty normal and it was only a matter of time before the $100 threshold was breeched. Well, today, our time is up as oil hit exactly $100.00/barrel today on NYMEX before receding into the high $90s.

$100/barrel is clearly a record in nominal prices, but it's also pretty close to - if not exceeding - the inflation-adjusted record price as well. Depending on the adjustment, $38 barrel of oil in 1980, the previous inflation-adjusted record price, would be worth somewhere between $96 to $101 in today's dollars. We're entering uncharted territory in oil prices now.

Anyone want to wager on where oil prices will be by the end of 2008? If so, place your bets in the comments section here (and for a more lucrative prize: a bottle of champagne to the victor I believe, check out this running contest at Jerome a Paris' DailyKos dairy).

[A hat tip to Jerome a Paris at DailyKos]

1 comment:

Jesse Jenkins said...

Wondering what the "cost" of $100/barrel oil is to the United States' economic prosperity and international competitiveness? Check out SolveClimate's excellent post: "Hello $100 Oil, Goodbye American Might"