Wednesday, January 02, 2008

Oil Less Than $70 Per Barrel in 2015?

Oil for delivery in December 2015 is trading on the NYMEX for $88.33 per barrel. Assuming a 3% average annual inflation rate over the next 8 years, that means that oil in 2015 is trading for only $69.72 per barrel in today's dollars.

2 Comments:

At 1/03/2008 10:51 AM, Blogger caveatBettor said...

What was your risk free interest rate and cost of carry for this calculation?

 
At 1/05/2008 10:54 AM, Anonymous Anonymous said...

Maybe the traders have seen this YouTube video from Vertigro Energy about making biofuel from algae.

http://www.youtube.com/watch?v=Lvb53l_Nfys

 

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