Tuesday, February 17, 2009

Crude should trade at $21.


In the late 1990s, oil companies traded on valuations that assumed a long-term oil price around $15 a barrel. The oil price should rise at the rate of global inflation, all other things being equal. Assume it was $15 in 1995. Then today it should be $21. Crude oil traded near $37 a barrel in New York on Tuesday, February 17, 2009.

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