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12.24.2010

Pain at the pumps: Companies brace for $100-a-barrel oil

Source: Globe & Mail, December 24, 2010

Crude oil markets are going out of 2010 like a lion – hitting two-year highs and raising predictions that prices will soon top $100 (U.S.) a barrel.

For motorists and businesses such as airlines and trucking firms, the surge in crude prices has meant a pre-Christmas crunch in fuel costs, with average Canadian pump prices now at their highest levels since October, 2008. And there is no sign they are about to ease.

“I’m not too surprised by the lift above $90 and I think we have some further gains here going forward,” Jim Ritterbusch, a veteran independent analyst based near Chicago, said in an interview Thursday.

“I’m afraid we’re going to see $100 oil in the first quarter – unfortunately.”

He said the fragile American recovery is being constrained by higher oil prices, which are driven more by higher demand in emerging markets but also buoyed by recent signs of economic growth in the U.S.

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