ND1028117

Title: Oil Prices Rising?

Description: Industry insiders say more oil companies will see $100 per barrel as the new normal.

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LONDON ? This week, several oil companies have indicated that $100 per barrel of crude oil is likely to be the new normal, Reuters reports. That could mean that the price floor for oil is inching upwards over the long term, which might translate into more mergers within the industry.

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Royal Dutch Shell and BP Plc both said they were basing project planning on $100-a-barrel oil prices. Ten years ago, the oil industry used a $25 per barrel price for such planning.

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?I think you'll find more and more people in the industry using numbers of $90 to $100 a barrel going forward,? said BP CEO Bob Dudley In 2008 before the run-up, BP was using a $60 per barrel model for planning.

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In April 2011, oil reached its high point thus far with $127.02, and traded at about $112 yesterday. In 2008, oil topped $147 for its record high.

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?It has been pretty stable and robust above $100 this year in what have not been easy macroeconomic conditions. I can't really give a prediction, but it has stayed strong,? Shell CFO Simon Henry said this week.

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?We believe the price of energy, while it will be volatile, will be strong going forward,? said Dudley. ?Growth in Asia and the emerging markets continues very, very strong.??

Content Subject: Petroleum Retailing

Formatted Article Date: October 28, 2011

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