$100 Oil No Longer Looks Expensive: Will Prices Hit $300?

The price of Brent crude has broken through the $100 barrier, and experts are now wondering how high it can go.

Omar Najia, a derivatives trader at BB Energy, believes that Brent crude will rise beyond its previous all-time high of about $145 in the coming months with a 'high degree of certainty'. Najia's reasoning is based on basic macroeconomics and financial arithmetic. He points out that global money supply has expanded by roughly 300 percent since 2008 when oil last approached $145, which would put an equivalent price today at around $300.

Najia's prediction is not without basis, as physical oil market conditions are increasingly supportive of higher prices. The Gulf's supply and logistical problems are multiplying, with traffic through Hormuz remaining a fraction of pre-war levels. Saudi Arabia's East-West pipeline has been temporarily knocked out by drone attacks from Iraq, while Houthi advances in Yemen have created another threat around the Bab al-Mandab.