Brent crude is still trading for around $120 per barrel, higher than it was two years ago.
NOW that the war in Iraq has begun, oil prices could go $10 a barrel higher -- or lower -- by this time next month.
The company said crude oil prices averaged more than $5 a barrel higher in the fourth quarter than in the comparable three months of 1999.
Before the Iraqi invasion of Kuwait, the trader said, the five-year forward price was about $22 to $23 a barrel, higher than the price of oil for immediate delivery.
Despite the clouds hanging over the economy, and recent stock market losses, several energy analysts say that oil prices will average $80 a barrel this year, $8 a barrel higher than last year's average — and nearly double the figure of 2004.
An oil price that, because of climate policy uncertainty, is $20 a barrel higher than it would otherwise have been implies that US consumers pay $400m per day more, of which $240m per day is paid to foreign oil producers.
If oil is only $10 a barrel higher than it would otherwise have been, and stays there a while, prices in general will rise, output and incomes will be reduced, and unemployment, at least for a while, will be raised.
The Brent, or world, price is currently about $6.50 a barrel higher than WTI.
The futures price for December 2006 is now $4 a barrel higher than the price for immediate delivery.
