Could oil fall to $50 a barrel by year's end?

That's the prediction of one industry executive, who adds that cheaper crude doesn't necessarily mean lower gas prices.

By Bruce Kennedy Jul 16, 2013 2:34PM

Oil and gas prices have been climbing, but at least one industry leader believes oil prices may soon make a dramatic drop.


Speaking on CNBC, Gulf Oil CEO Joe Petrowski said he imagines oil moving down to around $50 a barrel by the end of the year.

Petrowski said the decline is simply a matter of supply. "We're producing record amounts of oil and natural gas in the United States and in Canada," he said. "The market's well supplied. In fact, OPEC supplies are higher. As the price goes down, those who are targeting revenue actually have to sell more oil to maintain revenue."


Other factors bringing down oil prices, according to Petrowski, are slowing demand in China, an excellent supply-and-demand situation with crude and natural gas, more efficient cars and the rising use of alternative fuels. Image: Oil drums (© Kevin Phillips/Digital Vision/age fotostock)


"Traveling is picking up, but we're using much less oil," he said. "In fact, we're using no oil in the energy sector. Natural gas is taking a lot of the heating sector away."


But Petrowski also emphasized that $50 oil will not translate into $2-a-gallon gasoline, because that oil still must be transported and refined. "The fact that we're relying on railroads and trucks to move product from refinery markets to consumption markets, rather than pipelines," he said, "is adding another 35 to 40 cents" to the per-gallon price of gas.


Petrowski said other issues that can sway oil prices are problems with refineries in the Chicago and Gulf Coast regions as well as continued political unrest in the Middle East, which could spread and adversely affect oil producers in the region.


More on moneyNOW

207Comments
Jul 16, 2013 3:58PM
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When will the "Rev" Sharpton start his protest over this ?


Defenseless White Man Attacked By Black Teens, Dies
July 16, 2013 by


Last week, we got the agonizing news that a defenseless white man who had been beaten severely by a gang of six Black teenagers succumbed to his injuries and died. He was a living breathing person just as you and I. He was .  He was walking on a public street not bothering anyone. His cowardly attackers charged at him from behind, and all SIX of them beat him. After the cowardly attack, Mr. Mahaney was so traumatized that he was afraid to go out of his home. He lived for another year but collapsed, first psychologically than physically, under the weight of living with his injuries and caring for his elderly mother.

The police in Cincinnati have called this a “boredom beating” perpetrated by a gang of black teenage boys seeking entertainment. Decent people ask if this was an isolated incident and why these boys would do such a thing out of boredom.

Hand-wrung apologies from “sagacious” social scientists aside, the answer is quite simply because they “felt like it.”

”Boredom beatings” are the natural extension of giving these people EVERYTHING. They are born in public hospitals; their teenage mothers and Baby Daddies pay nothing. They are taken home to public , live rent free, go to government schools where they pay nothing, and are taught to hate America (especially White America and that when one of them is killed by a would-be victim, it’s the victim’s fault.) They see white people not as their neighbors and fellow Americans, but as their oppressors.

They are fed free of charge three times day at government , given clothing, given free transportation to and from school, and promoted from grade to grade by their height and not their academic achievement.

They are fed at home with free Welfare and SNAP cards. When they get arrested, they get free lawyers. When they get pregnant or father a child, they often give the child to their 40 year old grandmother and roam away to impregnate or become pregnant again.

After all of this free stuff is delivered to their feet, they come to believe they are also entitled entertainment. When they realize their government cradle-to-grave package doesn’t include entertainment, beating defenseless white people to death becomes the recreational activity of choice for some – not all – but some of these people. To keep this cycle in motion, they sell their vote to their Democrat enablers every two years.  Any questions?

Jul 16, 2013 6:22PM
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Of course, if the price went to $150/bbl, THAT would affect gas prices ($5+/gal, but when it drops to $50/bbl, the price has no correlation (still ~$4/gal)
Jul 16, 2013 6:40PM
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Could oil fall to $50 a barrel by year's end?

Don't worry, the oil companies won't let that happen!  They'll just make up some phoney reason to raise the price, AGAIN!! 

Jul 16, 2013 5:34PM
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Won't matter if oil prices do drop. We'll still get shafted by the oil companies and we will still be paying $4.00 damn dollars per gallon.
Jul 16, 2013 5:56PM
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Won't make any difference how much oil or pipeline we have if we don't have the refinery capacity..
Jul 16, 2013 5:50PM
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We'll get a global recession if oil goes to $80 a barrel?  If the U.S. population gets a huge relief at the pump, we'll have tons of extra dollars in our pocket.  The opposite of a recession is what will happen.

Jul 16, 2013 5:33PM
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So putting in adequate pipelines will cut the cost of gas by 35-40 cents.  Why aren't we putting in more piplines?  Oh yeah, Obama won't let us.
Jul 16, 2013 6:15PM
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"The fact that we're relying on railroads and trucks to move product from refinery markets to consumption markets, rather than pipelines," he said, "is adding another 35 to 40 cents" to the per-gallon price of gas."

 

OK, so $2.40 a gallon vs $3.75?

 

Jul 16, 2013 4:13PM
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It was reported that we started exporting our oil to the OPEC nations? What are those politicians-----CRAZY?
Jul 16, 2013 7:22PM
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Whats with these experts? Every other day I hear different facts. Not enough drilling, too much drilling, There are refineries working at 75% and others shut down to keep supply low. Oil companies are their own superpowers,

Jul 16, 2013 6:19PM
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High priced oil is the only thing keeping OPEC countries like Iran afloat, and who knows how many terrorist organizations get funding form OPEC.  I don't think OPEC could survive $50 oil.
Jul 16, 2013 6:48PM
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I was reading a few months ago where China is building huge tanks to hold Oil  and building many more when prices ever do go down so they can stock pile it.Which means even if it does come down China will just buy it all up.This is our own Governments fault they have betrayed us and i see nothing but Traitors to the American People.
Jul 16, 2013 3:18PM
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Story already posted once....the interviewer interrupts the expert over and over....annoying ...just let the expert talk ...stupid media as usual...
Jul 16, 2013 7:35PM
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we buy most of our oil from Canada and Mexico anyway, so what does the middle east have to do with the price of beans in china
Jul 16, 2013 6:32PM
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The government should drill on government land and set the price of oil @$80.00 bucks /barrel.

 

Set-up a refineries at strategic locations incase oil goes through the roof! Maintain a set price that everyone is OK with. The Opec said they could live with 80 a barrel. Take the profits from the refinement and pay-down our debt. It is a win-win for everyone!

 

I guess that is to hard to understand that congress doesn't want our natural resources destroyed. I agree with that, but if you drill responsibly by the government, then they can only blame themselves if something goes wrong.

 

Again win win!

 

Stay thirsty my friends!

Jul 16, 2013 6:07PM
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I don't buy that number for a minute.  Nothing short of another recession will take prices that low...  $50 is basically the incremental cost of supply where some production would be idled because it was unprofitable.  If the most expensive oil only costs a little north of $50/barrel to produce, why does it currently trade for north of $100 as opposed to say $55?  Because at $55 demand would seriously outstrip supply... 

 

Oil has been north of $90 for so long because that's what price it takes to encourage all of these efficiency gains and to limit demand to the available supply. The global oil market is big and growing and can easily absorb extra US production without anywhere near the price drop he's talking about.

Jul 16, 2013 7:52PM
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Oil will drop to $50 per barrel when the value of Obama dollars is doubled.  That's a long time coming, and the printing press just keeps on printing.
Jul 16, 2013 6:23PM
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You will have lunch with Marylin Monroe before you get $50 oil. Supply & demand will prevail and consumption is high

right now and there is a lot of people that will hit the road since winter was extended this year almost until June 2013.

Jul 16, 2013 6:35PM
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Im buying a big brand new g-dang 1 ton dually with all the whistles if we get $1.99 Diesel all you can burn!!!!!
Jul 16, 2013 5:54PM
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Only if everyone in China and India die from the black plague!

Har har har!
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