'Don't be too complacent'
Executives should not get too complacent about how oil prices settled in the $70 to $80 a barrel range over the past several months as the economic recovery has yet to catch up, the head of consultancy IHS Cambridge Energy Research Associates warned ahead of the CERAWeek conference.
While crude appears to have found a sweet spot, the global recession has eroded demand for petrol and diesel, and Washington wants to regulate the carbon-intensive energy industry's emissions. And after two straight yearly declines in global oil demand took prices from their 2008 heights near $150 a barrel to about $32 in December 2008 before recovering to about $80 currently, sure signs of economic recovery are not quite there.
"One lesson we've learned about the oil price – never to be too confident about stability," said Daniel Yergin, Chairman of IHS Cambridge Energy Research Associates and author of the Pulitzer Prize-winning history of the oil industry, The Prize.
The symbiotic link between oil and the economy will dominate CERAWeek, the prestigious consultancy's annual gathering of elite energy and economic figures and thinkers.
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