begin quote: "Wall Street Bank Merrill Lynch said this week that oil prices could climb to $200 over the next five years." end quote.
If this is true since gas is right now over $5 a gallon is at some stations in Los Angeles and since gasoline in England is almost $10 a gallon, likely at $200 a barrel it would then mean around $10 a gallon gas in the U.S. and around $15 dollars a gallon gas or more in England and the rest of Europe. If this happens it does eventually look like a world wide recession would be the outcome at that point.
As I see it the longer that the tension with Iran and Syria exists the more likely the outcome is worldwide recession or outright worldwide depression within 5 years unless there is a way to quickly resolve the Iran and Syrian issue. I think because of this it is possible that Israel and Europe eventually may attempt a quick military fix of these two problems. I think all of Europe and the U.S. and even China might really want a quick end to this problem because the whole world economy will really suffer the longer all this drags on.
On top of all this the U.S. because of its governmental design and natural resources tends to be more adaptable and able to go through a deleveraging a little quicker than Europe. And Europe will tend to go through deleveraging quicker than China will. So, likely in the long run this oil problem on top of deleveraging is going to hurt first Europe and then China more than it has hurt the U.S. already because the U.S. is now into a fragile but relatively solid recovery in the long term. But even the U.S. won't be helped by the increase in Oil prices.
However, check out this next quote from above article:
Few have forgotten that in 2008, within six months of hitting its all-time high, oil plunged as low as $35 a barrel with the onset of the global credit crisis.
In the United States, demand for refined oil products is close to its lowest level in nearly 15 years, indicating that motorists are cutting back their mileage." end quote.
So, how come if the U.S. demand is the lowest in 15 years already and likely the demand is getting lower by the day as the price rises, what is driving the prices upward? Some say speculation and others say Iran and Syria and the Strait of Hormuz. Whoever the real culprits are you can bet the world isn't going to be nice to them now anyway you look at it. Rich nations and rich corporations both have dirty tricks departments that secretly act under these circumstances and often people disappear in times like these. Just study history and you will see what I mean. I don't think I have seen times as strange as these since the Cuban Missile Crisis during the Kennedy Administration. Only instead of the problem being the Soviet nuclear missiles in Cuba it is the potential nuclear missiles in Iran and the genocide in Syria.
But if Israel actually feels its very existence is threatened by Iran, one of those countries might not be around this time next year. Time will tell.