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HomeEconomy$100 Oil: A Hurdle, Not a Roadblock, Says Chevron CEO

$100 Oil: A Hurdle, Not a Roadblock, Says Chevron CEO

There’s a murmur in the energy markets, and it’s not going away anytime soon. Oil prices are accelerating toward a potentially seismic $100 per barrel. But if you’re sweating over this, Chevron’s CEO, Mike Wirth, wants you to cool your jets.

West Texas Intermediate crude oil has witnessed a significant 30% uptick since July, peaking at $91.36 recently. Brent crude isn’t far behind, hitting a ten-month zenith of $94.95. And yes, consumers feel it, too, with the average national gas price revving up to $3.88, as per AAA’s data.

Digging into the ‘why’, Wirth highlights two main catalysts: Firstly, there’s a tight supply environment, with power players like Saudi Arabia and Russia continuing to maintain their production outputs. Secondly, a resilient global economy is fuelling an unwavering demand for this golden liquid.

“We’re en route,” Wirth mentioned when discussing the potential of hitting that $100 benchmark. “The supply is getting scarcer, and our inventories are dwindling. Though these transitions are often incremental, all pointers indicate we’re on this trajectory.”

But here’s the twist: Even as many dread the potential domino effect of rising gas prices on consumer sentiment, Wirth presents an optimistic perspective. Reflecting on the past, he recalls how the economy withstood elevated oil prices throughout 2022.

“The talks of an impending recession have been in the air, yet here we are, still standing strong. Despite the occasional drags, the foundational pillars of both the US and global economies appear robust. So, from where I see it, our economy can take the hit,” voiced Wirth.

For a bit of context, Chevron, boasting a valuation of a cool $320 billion, stands as America’s second oil giant, shadowed only by Exxon Mobil.

In essence, while the road to $100 oil is paved with uncertainties, leaders in the sector believe it’s just another turn in the ever-evolving world of business and economics. And if history’s any guide, adaptability is the name of the game.