Oil: Bank of America says oil could hit $100

How high might oil prices go? Bloomberg (Oct 1) reports that Bank of America thinks it might hit $100 by winter.

Why?

1. A switch from gas-to-oil due to the high price of natural gas.

2. If there is a cold winter.

3. The opening up of international travel and the impact that would have on aviation fuel.

This would cause increased inflation and would have a negative economic impact.

What would that do to gas prices in Los Angeles (where I live)? Well, gas prices range from $4.00 to over $5.00 currently. How gas prices can have such a large range is beyond me. Admittedly, the $4.00 is discount gas stations as well as Arco and 76 and Shell are more like $4.40s, but I have definitely seen the odd location where even regular fuel prices are $5.00. Premium can definitely be found at over $5.00 at many locations. So if oil goes from close to $80 to $100, will we see prices in the $5.00 to over $6.00 range? Ouch.