Bloomberg News, "Oil is on course for its strongest second half on record, bolstered by sanctions against Iran, speculation that Europe’s debt crisis will be resolved and the prospect of additional U.S. economic stimulus." West Texas Intermediate crude will cost $94.50 a barrel on the New York Mercantile Exchange on average this quarter, up from $92.20 in the previous three months, according to the median of 26 analyst estimates tracked by Bloomberg. Oil’s previous highest level for any second half was $91.78, in 2011.
European Union and U.S. curbs on oil supplies from Iran, at least $500 billion in bailout commitments for Greece, Spain, Portugal and Ireland and a third round of quantitative easing from the Federal Reserve helped drive the Standard & Poor’s GSCI Index of 24 raw materials 11 percent higher last quarter. The gains for oil are set to keep OPEC members’ revenue above $1 trillion for a second straight year. WTI averaged $96.16 in the first nine months of this year.
At the same time, Brent averaged $112.20, just 7 cents below the same period of 2008, the year in which prices peaked at a record $147.50 a barrel. Brent tumbled 20 percent in the three months to June 30, the biggest quarterly drop since the end of 2008, as Europe’s debt crisis spread. It rallied 15 percent in the third quarter.
Plus bailouts are bullish! Greek Prime Minister Antonis Samaras said on Sept. 27 his government reached an agreement on a two-year 13.5 billion-euro ($17.6 billion) budget package that was key to receiving international aid. The same day, Spanish Prime Minister Mariano Rajoy’s nine-month-old government announced its fifth austerity package in what may be a move to head off tougher conditions demanded as part of a potential European bailout.
According to the Mayan calendar the world is supposed to end December 21st of this year. One car dealer in the Chicagoland area is offering an end of the world discount. You can buy a car at an end of the world’s clearance price. If the Mayans are wrong you still get the discount. If they are right then you get the car fort free. What a deal!