Bank warns fuel price hell is on the way
Goldman Sachs has said we're not going to get any relief from rocketing prices before 2014, and in the interim things are going to get a whole lot worse.
PredictionsThe US bank has predicted that the price per barrel of Brent Crude (which is how we usually measure oil prices) will climb into 2013. Yesterday it was at $111.23 and it says it will hit $127.50 next year and then as much as $135 in 2013.
To put that in perspective, at the height of the Arab Spring, when the world was in turmoil, the price was $126.90.
So as bad as things were earlier this year, they are going to be even worse by 2013.
What it means for usIf this comes to fruition it will mean more than spending more at the pump and having to find the cash elsewhere in the budget. These kinds of prices will force a complete rethink about how and why we use fuel. It may mean many people give up on their car for all but emergencies. We may have to stop visiting far-flung friends and family, and seriously reconsider days out.
It pays to think ahead to this sort of situation and consider how you will cut back on your travel. If you can plan for it now, it means making the right sort of cuts for your family, rather than being flung into crisis when you run out of petrol and haven't the cash to fill up again.
The hope factorThe only glimmer of hope is that this is only an estimate from Goldman Sachs. And while this may be their specialist subject, it's still only a guess. They have admitted that if the European crisis tips us into a global recession, then all bets are off, as consumption will fall through the floor and the price will drop like a stone.
They have also been wrong before. In May 2008 they were their most wrong, when they said prices would be $200 within six months. In fact, prices fell back to $40 by the end of the year.
Mind you, it comes to something when your only hope for an affordable tank of petrol is a global recession.