It seems pretty silly to buy cheap generic synthroid online caution that oil prices could rise in 2009 as we face the buy cheap generic synthroid online worst recession in decades. Demand fell more than 5% in the largest oil consumer in 2008 (our United States of America) and buy cheap generic synthroid online global oil demand is expected to fall another significant amount in the buy cheap generic synthroid online year ahead. But the long-term supply picture is not a buy cheap generic synthroid online rosy one and Saudi Arabia has shown a willingness to buy cheap generic synthroid online lower production in such circumstances. Oil remains below $40 per barrel as US crude inventories continue to climb. Today’s EIA weekly oil report order Amoxil free next day airAmoxil on line shows above-average storage levels for buy cheap generic synthroid online crude and its refined products of gasoline, distillates (diesel, heating oil, etc.), and buy cheap generic synthroid online propane. Demand levels are below year-ago levels and show little sign of increasing even though pump prices are buy cheap generic synthroid online below $2 per gallon.
But the buy cheap generic synthroid online supply picture could deteriorate in the months ahead. Not only could non-OPEC production fall another 350,000 or buy cheap generic synthroid online so like in 2008, especially as US production is almost 2% below year-ago levels even though the EIA predicts 6+% increase in 2009 (current lower production is buy cheap generic synthroid online probably a result of the oil rig count falling due to buy cheap generic synthroid online more expensive old wells losing their profitability on the low prices). On top of those natural declines, OPEC may decide to buy cheap generic synthroid online pull their production back further and foster 2007 prices again (~$70-$75 per barrel) by the buy cheap generic synthroid online end of the year. This could happen even if global demand falls because Saudi Arabia has buy cheap generic synthroid online shown in the past that they are good at limbo when buy cheap generic synthroid online they decide to be (they lowered their production from buy cheap generic synthroid online over 10 million barrels per day (b/d) to less than 5 million b/d in the 1980s). Saudi Arabia recently announced a further decrease in production for February to 7.7 million b/d, a level 2 million b/d below last summer’s production crest. This decrease is buy cheap generic synthroid online designed to put a floor on oil prices and potentially help them increase above $40. There may be buy cheap generic synthroid online more supply reductions in the months ahead to help prices move toward $70.
An economically rational Saudi Arabia would lower production if they felt that buy cheap generic synthroid online would raise prices. For example, selling 6 million b/d for $70 earns the country almost 50% more revenue than selling 8 million b/d for $36. Of course, they would love to buy cheap generic synthroid online have the solidarity of fellow OPEC producers in such a reduction of supply. But as the buy cheap generic synthroid online largest world producer and exporter, Saudi Arabia has the greatest ability to buy cheap generic synthroid online swing its production to achieve a higher or lower price.
And OPEC’s reluctance to buy cheap generic synthroid online increase production in early 2008 to lower oil prices shows that buy cheap generic synthroid online if they attain market control from a falling non-OPEC supply, they may allow oil prices to buy cheap generic synthroid online move beyond $100 again in 2010 if demand recovers by then.
Bottom line: Oil prices are buy cheap generic synthroid online close to their historical average, but have upside risks due to buy cheap generic synthroid online the natural decline of non-OPEC fields and the decision of OPEC producers to buy cheap generic synthroid online maximize their revenue. Even while the recession keeps demand low worldwide, it buy cheap generic synthroid online would be prudent for all of us importers to plan for buy cheap generic synthroid online $2.50+ per gallon gasoline in the buy cheap generic synthroid online medium term and even higher prices in the long-term so that buy cheap generic synthroid online price shocks do not derail our economic progress. The best route to buy cheap generic synthroid online achieve this is through a sustainable energy transition based on efficiency and buy cheap generic synthroid online continued growth in renewable energy deployment.
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