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Gold/Mining/Energy : Oil Sands and Related Stocks
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From: kidl3/7/2006 9:55:12 AM
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CIBC outlook on oil ...

TORONTO -- The resumption of the hurricane season in the Gulf of Mexico will see oil prices soar to near the $80 US mark in the second half of the year, predicted a CIBC World Markets report released yesterday.
The report also found increasingly destructive cyclonic activity in the Gulf, as predicted by many climatologists, may spell a decline in Gulf production and increase U.S. reliance on foreign supplies.
'BIG JUMP'
"This drop will result in a big jump in U.S. oil dependency from a current level of 65% to an estimated 72% by 2010," said CIBC World Markets chief economist Jeff Rubin.
"In the short-run, production disruptions will likely see West Texas Intermediate establish a new record high crude price over this year's storm season and average $78 US a barrel in the fourth quarter."
The CIBC report examined the impact on production rates and planned capacity expansions over the balance of the decade in the Gulf of Mexico if climatologists predictions of increased cyclonic activity in the Gulf pan out.
STILL VULNERABLE
The report found the vulnerability of production in the region has not changed from last season and is not likely to improve over the next several years.
"In the longer term, hurricane disruptions will deal a lethal blow to America's quest for greater energy self-sufficiency," notes Rubin. "We predict Gulf production will average about 20 per cent below the 2003 production peak over the rest of the decade."
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