Monday, October 20, 2008 : Mean Street: The Reluctant Prophet of Goldman Sachs

"The latest of these prophets is Arjun N. Murti, an influential Goldman Sachs oil analyst, who has marched his bullish oil followers straight off a cliff.
You may not have heard much of Murti, a publicity-shy 39-year-old from New Jersey. He leads the Goldman Sachs Americas Energy Research Team and has been researching energy stocks since he was 23.
Along with OPEC, T. Boone Pickens and some pipeline-destroying Nigerian rebels, Murti moves the oil markets. “Even if you disagree with their views, the problem is that Goldman does carry such credibility,” said one energy trader to the New York Times in May. “There are a lot of traders who are going to buy based on their reports.”
In 2004, Murti offered up his “Super-Spike” theory–saying future price spikes in oil are inevitable. Murti’s argument was simple: The world is running out of oil, and its expanding economy would continue to push prices higher. Unpredictable geopolitical forces, meanwhile, would create the “super” in the Super-Spike.
On March 30, 2005, with oil trading at $54, he laid down a controversial call. A barrel of oil could fetch $105 by 2009.
As prices rose over the ensuing three years, Murti’s reputation grew in kind. Barron’s dubbed him “Mr. Crude Oil.”
Then came the next big shocker. On May 6, 2008, Murti predicted $150 to $200 oil within six to 24 months. Prices dutifully jumped. Then they rose even higher, peaking at more than $147 on July 11."


Anonymous said...

why not invite him to joing OPEC

Anonymous said...

Murti, 39, argues that the world’s seemingly unquenchable thirst for oil means prices will keep rising from here and stay above $100 into 2011. Others disagree, arguing that prices could abruptly tumble if speculators in the market rush for the exits. The grim calculus of Murti’s prediction, issued in March and reconfirmed two weeks ago, is enough to give anyone pause: in an America of $200 oil, gasoline could cost more than $6 a gallon.