Crude Oil Price Increases - 

Late 2007 increases

On October 19, 2007, US light crude rose to a new height of $90.02 per barrel due to a combination of ongoing tensions in eastern Turkey and the reducing strength of the US dollar. Prices fell briefly on the expectation of increased US crude oil stocks, however they rose again rapidly to a peak of $92.22 on October 26, 2007 when stocks were revealed to have instead fallen.

Prices increased throughout late October and early November. On November 7, 2007 light crude oil reached another record, closing at $98.10 per barrel. As of November 21, 2007 oil prices rose to a new high of $99.29 per barrel, leading to fears of the price breaking the $100 per barrel mark due to a Wall Street Journal report which stated that peak oil had arrived.

Early 2008 increases

March 15, 2008,
On January 2, 2008 US light crude surpassed the psychological barrier of $100 before falling to $99.69, due to tensions on New Years Day in Nigeria and on suspicion that US stocks of crude will have dropped for the seventh consecutive week. A BBC report from the following day stated that a single trader bid up the price. Stephen Schork, a former floor trader on the New York Mercantile Exchange and the editor of an oil market newsletter, said one floor trader bought 1,000 barrels (160 m³), the smallest amount permitted, and sold it immediately for $99.40 at a $600 loss. However, on January 3, oil rose to $100.05 a barrel in intraday trading. Oil fell back later in the week to $97.91 at the close of trading on Friday, January 4, in part due to a weak jobs report that showed unemployment had risen.

Despite news on weakened demand, the price of oil once again rose to $100.10 a barrel on February 19th after a Texas refinery fire, rumours about OPEC production cuts, and evidence that the supply of oil is decreasing faster than demand of oil. Oil prices rose above $101 a barrel February 27, 2008. Oil prices surpassed $103 a barrel February 29, 2008 as continued weakness in the U.S. dollar and the prospect of lower Federal funds rates attracted fresh capital to the oil market.

Oil prices continued to rise to $104 on March 3, 2008 continued by the weakness in the United States dollar. The OPEC on March 5, 2008 accused the United States of economic "mismanagement" that it said is pushing oil prices to record highs, rebuffing calls to boost output and laying blame at the feet of the George W. Bush administration. Oil prices surged above $110 to a new inflation-adjusted record on March 12, 2008 before settling at $109.92. Oil continued its soar skywards, hit $111 a barrel, on March 13, 2008, before sliding back to below $110 amid fears of economic recession in the United States.

The record was again broken on March 17, 2008, with U.S. light sweet crude reaching $111.80. On April 15, 2008 the price of oil broke the $114 mark for the first time. The price increased to $115.07/barrel on April 16, 2008 due to the increasing weakness of the US dollar,] and increased again to $117 per barrel on April 18, 2008 after a militant group in Nigeria said it had attacked an oil pipeline. Oil prices rose to a new high of $119.90 a barrel on April 22, 2008, before dipping and then rising $3 on April 25, 2008 to $119.10 on the New York Mercantile Exchange after a news report that a ship contracted by the U.S Military Sealift Command fired at an Iranian boat.

Mid 2008 increases
Gas prices on Memorial Day 2008 outside Bakersfield, California

On May 9, 2008, the oil price exceeded $125 per barrel for the first time, while on May 21, 2008 the oil price exceeded already $130 per barrel of Brent Crude. In approximately 24 hours from May 21 to May 22nd, 2008, the price per barrel of oil passed $135.

In June, oil prices fell sharply at first but then rebounded nearly $6 on June 5 after evidence that Venezuela, a major oil supplier to the United States saw production fall 5% since January 2008 due to aging oil fields, generating serious supply concerns in the wake of falling oil production in Mexico, Russia, and Nigeria. On June 6, prices rose $11 in 24 hours, the largest gain in history. The possibility of an attack on Iran by Israel was considered to have contributed to the rise. The combination of two major oil suppliers reducing supply has generated fears of a repeat of the 1973 energy crisis.

Forecasted prices and trends.

Fatih Birol, chief economist of the International Energy Agency expressed his opinion in October, 2007 that oil prices will remain high for the foreseeable future due to rapid increases in demand from the huge developing economies of China and India. Although India has raised prices, China has "no plans" to do so. According to informed observers, OPEC, meeting in early December, 2007, seemed to desire a high but stable price that would deliver substantial needed income to the oil producing states, but avoid prices so high that they would negatively impact the economies of the oil consuming nations. A range of 70–80 dollars a barrel was suggested by some analysts to be OPEC's goal.

Some analysts point out that major oil exporting countries are rapidly developing; and because they are using more oil domestically, less oil may be available on the international market. This effect, outlined in the export land economic model, could significantly reduce the oil available for trade and cause prices to continue to rise. Particularly significant are Indonesia (which is now a net importer of oil), Mexico and Iran (where demand is projected to exceed production in about 5 years), and Russia (whose domestic petroleum demand is growing rapidly).

In May, 2008, Barclays Capital raised its forecast for average crude oil price in 2008 from its previous prediction of $100.80/bbl to $116.90/bbl, citing the only modest decreases in oil consumption among OECD countries, strong demand growth among non-OECD countries, the slow development of alternative fuels, and weak non-OPEC supply which "continues to under-perform dramatically relative to consensus expectations."

In May, 2008, Arjun N. Murti and other Goldman Sachs analysts issued a research report predicting oil prices are likely to rise to between $150 to $200/bbl in the next six to 24 months. This was a marked increase from Goldman Sachs' earlier (September, 2007) forecast of oil prices averaging $85/bbl through 2008, rising to $95/bbl at year end, which was in turn an increase from still-earlier predictions.

In June, 2008, Alexei Miller, head of Russian energy giant Gazprom, warned that the price of oil is likely to hit $250 a barrel sometime in 2009. Miller said that while speculation had played a role in oil prices, "this influence was not decisive."
Near-term peak oil proponent Matthew Simmons predicts a rise to $300 a barrel or higher by 2013 as sweet crude petroleum becomes more scarce and major producers begin failing to meet demand.