Looking for Answers on Oil's Sudden Spike
Oil prices have soared nearly 10 percent in the past four sessions alone, and CNBC asked the experts for insights and answers.
Assessing Global Demand
“The thing that speculators are really hanging their hats on is the demand coming from Asia. This is an old story; it’s been going along for some time. The new twist here, however; is the tightness in global demand for distillates, particularly diesel.”
- Addison Armstrong, Tradition Energy director of market research
Blame The Speculators?
“Speculators basically don’t take delivery of the barrel. For every long on the Nymex, there’s a short. There are basically less speculative shorts today than there were in July when oil was $60 less. So I just think it’s a great—it’s a great excuse for people who have been wrong in their price. But the reality is, the fundamentals are basically showing that supply gains are getting fewer and fewer, and demand is still growing.”
- Matthew Simmons, Simmons & Co. International chairman
Discussing Diesel Distress
“No one is saying the sulfur issue is the key to everything. It’s one area where the government could temporarily back off and help prices, according to oil economists. And then again, we could decide that the benefit of less sulfur in the air outweighs the costs we are all—and especially the truckers—paying at the pump.”
- Steve Liesman, CNBC senior economics reporter
Can Airlines Survive $150 Oil?
“I think the answer is the [airline] industry has to consolidate, and then it has to pass costs onto the consumer. We’re going to have airlines. And if we’re going to have airlines, the consumer is going to have to pay more to have them.
- Bill Seidman, former FDIC chairman