Oil prices have doubled over the past year and a controversial report by Goldman Sachs predicts that they could reach as high as $US200 a barrel over the 6 to 24 months. US crude prices hit $US122.35 a barrel on Tuesday and Goldman Sachs says a chronic lack of supply will drive a "dramatic and continuous rise in oil prices", after which there would at some point be a sharp fall in demand as businesses scaled down. Citigroup said that it expects that the usual cycle will take place where prices could fall to as low as $US40 per barrel as fresh supply emerges. Over the next two years around 65 new deepwater rigs are due to come onstream compared with only 10 that commenced between 2002 and 2007.
