Some pundits are predicting $4 for a gallon of gas by mid-summer. Others are indicating $5 per gallon by summers’ end. Britain, at this point, pays roughly $6.50 per gallon. Some are indicating we will exceed that price by 2007.

However, just yesterday the price for a barrel of oil fell below $70 — over a slightly weaker demand and rising inflation. Some business analysts thought the selloff was triggered by profit-taking.

The Associated Press said:

Saudi Arabia said Monday that the market is well supplied, in part because high prices have trimmed consumption levels.

“There is no lack of capacity right now,” Saudi oil minister Ali Naimi told reporters on the sidelines of an energy conference in Amman, Jordan. Asked about the impact of high prices, Naimi said: “In general, when prices are high, people check their pockets and when they are lower, they open them.”

Light, sweet crude for June delivery fell $2.63 to settle at $69.41 a barrel on the New York Mercantile Exchange. That followed a drop of $1.42 on Friday.

That’s but one small blip on the petroleum screen. What are, for example, the Saudis and oil producing countries saying about the long-term future of oil? From NewsMax.com:

AMMAN, Jordan – Saudi Arabia’s oil minister warned Arab producers Sunday not to expect continued growth in prices and demand for oil.

Ali al-Naimi said prices could plummet if an economic crisis drives industrialized nations to find other sources of energy, citing the 1980s – when oil prices dropped by 80 percent after such nations reduced their dependency on oil and turned to alternative energy sources.

”Global economic growth may not continue at the same good momentum for years to come,” al-Naimi said at the opening of a four-day conference of Arab energy ministers in Amman. ”We should be careful and not take expectations as indisputable, especially the continuation of big demand for oil and its prices remaining at the same level or increasing,” he said.

Al-Naimi also cited the Asian economic crisis of 1997-1998, when oil prices fell by 50 percent, slowing Arab oil production.

”Some are even concerned about a looming economic problem because of the increased policies of economic protectionism, or what is known as economic nationalism,” al-Naimi said, referring to Western countries’ determination to become less dependent on Middle Eastern oil.

Still, oil prices are about 48 percent higher than a year ago, a reflection of the market’s fear about real and possible output disruptions at a time when the world’s supply cushion is perilously thin. Only Saudi Arabia has any spare production capacity, but it is less than 2 percent of the daily global demand of almost 85 million barrels and not the high quality crude that refiners prefer, analysts said.

This does not have to be an all-or-nothing equation. We can attack the petroleum issue on a number of levels at once should we choose to do so. We can drill in ANWR. We can drill off our own shores. We can begin personal conservation. We can move to ethanol.

We can do all this and more should we choose to do so. And doing so would be the way to go — particularly considering the countries from which we import oil are generally regimes of great instability — the Middle East, Venezuela, Ethiopia, even Mexico. The sooner we can divest ourselves of our economic need to deal, on bended knee, with these countries, the better off we will be politically, militarily and economically.

The writing is on the wall. Already some factions are worried about their future and their hold on us.

BZ