Oil prices will hit $200 within six to 24 months.
(Bloomberg, 4-06-08, Bloomberg, “Goldman’s Murti Says Oil ‘Likely’ to Reach $150-$200” < http://www.bloomberg.com/apps/news?pid=20601087&sid=ayxRKcAZi630&refer=home>)
Crude oil may rise to between $150 and $200 a barrel within two years as growth in supply fails to keep pace with increased demand from developing nations, Goldman Sachs Group Inc. analysts led by Arjun N. Murti said in a report.
New York-based Murti first wrote of a ``super spike'' in March 2005, when he said oil prices could range between $50 and $105 a barrel through 2009. The price of crude traded in New York averaged $56.71 in 2005, $66.23 in 2006 and $72.36 in 2007. Oil rose to an intraday record of $122.49 today on speculation demand will rise during the peak U.S. summer driving season.
``The possibility of $150-$200 per barrel seems increasingly likely over the next six-24 months, though predicting the ultimate peak in oil prices as well as the remaining duration of the upcycle remains a major uncertainty,'' the Goldman analysts wrote in the report dated May 5.
A report yesterday showed U.S. service industries expanded in April, signaling higher energy use. The Institute for Supply Management said its index of non-manufacturing businesses, which make up almost 90 percent of the economy, grew for the first time since December. China is increasing refining capacity and boosting imports to meet rising demand for the Olympic Games.
Russia expects oil prices to increase-slow global growth.
(Halia Pavliva and Christian Schmollinger, staff writers, 7-3-08, “Medvedev Sees Oil Price at $150, Slower Global Growth,” Bloomberg.com)
Dmitry Medvedev, the president of Russia, the world's second-biggest oil producer, expects prices to rise to $150 a barrel and retard global growth.
``Oil prices will reach $150 a barrel,'' Medvedev said in a meeting with reporters in Moscow ahead of his participation in a summit of the Group of Eight industrial countries in Japan on July 7-9. ``Unfortunately, rising oil prices create problems for the world's economy.''
Russia is in its 10th year of economic growth, boosted by record oil prices that doubled in the past year to record highs. Gross domestic product expanded by 8.5 percent in the first quarter, the second fastest pace since 2000.
``It's odd for any politician to be talking the market up, but they are a big exporter so it's in his interest,'' said Tony Regan, an energy consultant with Nexant Inc. in Singapore. ``It's also saying that `you can't take me for granted.' The G-8 meeting will have a lot of leaders interested in bringing the oil price down but he won't necessarily agree with that.''
AFF—NO IMPACT
Russia economy doesn’t have large role in world economy.
Clifford Levy, New York Times staff writer, 7-3-08, “U.S. IS in No Shape to Give Advice, Medvedev Says”
Russia’s new president, Dmitri A. Medvedev, less swaggering than his predecessor but as touchy about criticism from abroad, said in an interview that an America in “essentially a depression” was in no position to lecture other countries on how to conduct their affairs.
With soaring oil revenues bolstering the Russian economy and Kremlin confidence, Mr. Medvedev brushed aside American criticism of his country’s record on democracy and human rights. He also said that a revived Russia had a right to assume a larger role in a world economic system that he suggested should no longer be dominated by the United States.
In the interview, Mr. Medvedev was asked about a call by Senator John McCain of Arizona, the presumptive Republican presidential nominee, to bar Russia from the Group of 8 because of its record on democracy. Mr. Medvedev, who easily won Russia’s presidential election in March after the Kremlin hobbled the opposition, responded that the question of democracy was irrelevant to the Group of 8 and, besides, the United States had more pressing matters to attend to.
“The Group of 8 exists not because someone likes or dislikes it, but because objectively, they are the biggest world economies and the most serious players from the foreign policy point of view,” Mr. Medvedev said. “Any attempts to put restrictions on anyone in this capacity will damage the entire world order.”
He added, “I am sure that any administration of the United States of America, if it wishes to succeed, among other things, in overcoming essentially a depression that exists in the American economic market, must conduct a pragmatic policy inside the country and abroad.”
Mr. Medvedev said world leaders should realize that the credit crunch and a gathering global recession signaled that the worldwide economic architecture needed to be overhauled. He did not specify how this should be done, but indicated it should entail a reduction in the influence of the United States.
Fall in oil prices won’t affect the Russian economy
BBC Monitoring the Former Soviet Union 6-14-08, G8live.org “Fall in oil prices will have no effect on Russian economy - finance minister” http://g8live.org/2008/06/14/fall-in-oil-prices-will-have-no-effect-on-russian-economy-finance-minister/
Moscow, 14 June: A fall in oil prices will have no major effect on the Russian budget, according to Russian Deputy Prime Minister and Finance Minister Aleksey Kudrin.
“Russia is not afraid of (oil - Interfax) prices going down. Our budget can operate deficit-free at the level of 55 dollars a barrel. The tax system for our oil companies is calculated in such a way that when oil prices go down, taxes go down too. So, there will be no significant change. To a small extent and insignificantly, compared with the previous period, this will affect the growth of our GDP. But, I repeat, this will be insignificant,” Kudrin said in an interview with the Vesti-24 TV channel, talking about the results of the G8 financial ministers’ meeting in Osaka (Japan).
“Most analytical and energy institutes do not believe that oil prices will go down. At times of slowdowns in the world economy oil prices have always gone down, and this view had prevailed until this meeting. But this time I heard serious concerns to the effect that prices won’t go down soon and may even stay at the new level,” the finance minister said.
“At the meeting we discussed factors connected with the outrunning growth of demand and simply the effect of demand on insufficient offer. As well as the effect of other factors, including speculation factors whereby, in search of reliable investment for assets, products, including oil and grain, are being bought up, thus resulting in increased demand for these products and more price rises,” Kudrin said.
TAP Pipeline Disadvantage 1NC Shell (1/2)
A) UNIQUENESS: TAP PIPELINE POPULAR AND GOING TO BE BUILT NOW
Reuters, India joins Pakistan in Turkmenistan pipeline project, 4/24/08 (http://in.reuters.com/article/topNews/idINIndia-33223120080424)
India signed up on Thursday to join a multi-billion dollar Turkmenistan-Afghanistan-Pakistan gas pipeline project, to secure another source of energy for its fast growing economy.
Indian Oil Minister Murli Deora and counterparts from Pakistan, Turkmenistan and Afghanistan signed a framework agreement for the $7.6 billion pipeline, that they aim to start building in 2010.
The idea of piping gas from Turkmenistan to south Asia has been little more than a dream for years because of the turmoil in Afghanistan, but the ministers said they were determined to complete the project.
B) LINK
1) PLAN LEADS TO MORE ALTERNATIVE ENERGY USE WHICH DECREASES OIL DEMAND
MIER, Explaining High Oil Prices, 8/20/07, (http://www.mier.org.my/mierscan/archives/pdf/samirul20_08_2007.pdf)
However, exceptions can be found regarding the expected effects of demand and
supply. For example, higher prices have not had a substantial impact on the demand for oil. Theoretically, the demand for oil should change as a result of consumers’ sensitivity to fuel price changes. This change has not occurred because the price elasticity of demand for oil is relatively low. An increase in oil price will not reduce the demand for oil because oil is a necessity. The only way to reduce the demand for oil is to find viable substitutes i.e. alternative energy and fuel sources.
2) INTERNAL LINK: OIL DEMAND MUST BE HIGH IN ORDER FOR THE TAP PIPELINE TO BE BUILT
John C.K. Daly, a Eurasian foreign affairs and defense policy expert for The Jamestown Foundation based in Washington, D.C., TAP pipeline: Reality or romance?, 6/3/08
But ballpark estimates are not enough to attract massive foreign investment, and Niyazov's successor, President Gurbanguly Berdymukhamedov, has taken measures to define the country's hydrocarbon resources on Western terms. Six months ago he ordered Vice Prime Minister Tachberdy Tagiev to conduct an audit of the country's hydrocarbon deposits.
"Certifying oil and gas supplies in the country's fields will allow us to clarify our strategy for further developing the use of our hydrocarbon resources and account for the high goals set in the program of development of Turkmenistan's oil and gas industry through 2030 that would promote the development of the mutually beneficial international cooperation in the energy sector," he said.
British firm Gaffney, Cline & Associates was hired to conduct Turkmenistan's first independent natural gas reserves audit. TAP fits into Ashgabat's ambitious development plans; two months ago, Turkmengaz Oil and Gas Institute Director Makhtumguly Khydyrov said Turkmenistan is seeking to boost annual gas output from its 80 bn cm per annum to 130 bn cm, which would require massive foreign investment. If geopolitical reality is ignored, then TAP could be a substantial component of such development.
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