Replies to post #47271 on IAHL Corporation (IAHL)

[energybuyer]

Oil's magic number that everyone is talking about: Morning Brief
Javier E. David
Javier E. David·Editor focused on markets and the economy
Wed, March 9, 2022, 5:52 AM
In this article:

^DJI
-0.56%


^GSPC
-0.72%


BZ=F
-4.02%


CL=F
-4.55%


SPY
-0.76%


^IXIC
-0.28%


This article first appeared in the Morning Brief. Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET. Subscribe

Wednesday, March 9, 2022

With prices ‘unhinged,’ next stop could be $150 (or higher)
Uncle Sam is preparing to hit the Siberian bear where it hurts. And a lot of people will be feeling the pain.

On Tuesday, President Joe Biden vowed to do the previously unthinkable: ban Russian energy imports in response to its invasion of Ukraine. Although Russian oil comprises a slim 3% of U.S. oil stocks, spiraling energy prices hardly needed the additional impetus. Brent ended more than 3% higher above $124 per barrel, and gas crept further above $4 per gallon to their highest ever.

While the embargo will ostensibly cripple Russia’s finances as it continues a brutal frontal assault on Ukraine, the shockwaves — already cascading across energy, wheat (soon to become yet another source of food inflation) and nickel markets — will be felt everywhere. In a Yahoo Finance interview Tuesday, Commerce Secretary Gina Raimondo bluntly admitted that the invasion “isn’t going to be painless for anyone.”

So how high can oil go? Wall Street economists, already nervous about inflation and elevated demand that’s buttressing crude prices, are coalescing around a very specific magic number: $150 per barrel. But unlike the lottery, this one won’t win consumers any prizes.

“Soaring oil prices will worsen the near-term global economic outlook, by both slowing growth and boosting already high inflation,” Ben Laidler, global markets strategist at social investment network eToro. “The only silver-linings are that global growth is currently robust. Whilst ‘the solution to high oil prices is high oil prices’ as consumers are increasingly driven to cut demand by the surging cost,” he added.