Global Biz

Higher oil prices threaten to become the new norm

(Xinhua)
Updated: 2011-03-01 15:21

WASHINGTON - Ongoing turmoil in the Middle East and North Africa threatens to bring about an extended period of heightened oil prices, turning the recent spike in energy costs into the norm rather than the exception, a US expert told Xinhua in an interview.

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"Could we expect to see oil remain in the range of $100 to $150 per barrel, even after the dust settles?" said Bernard Baumohl, chief global economist at the Economic Outlook Group and regular commentator on PBS' "Nightly Business Report."

"The lack of clarity as to how this all will end will keep oil prices high and raises the question of whether this new normal could be seen at least for the next year."

Energy costs have trended upward in recent months due to heightened global demand, and social unrest in the center of world oil production has exacerbated that upward push.

Crude oil for delivery in April surged more that 9 percent last week on the New York Mercantile Exchange, and US oil was up 6.5 percent for the whole of February.

International Monetary Fund chief Dominique Strauss-Kahn said on Monday in a speech from Panama that oil prices could hurt global economic growth if they remain high for an extended period of time.