Oil prices may soar to $140 a barrel this summer: economists

NEW YORK: Goldman Sachs economists have predicted oil prices will surge to $140 (Rs28,382) a barrel this summer, with a drop in Russian production and a gradual recovery in Chinese demand adding to the pressure on already low supplies.

But they said consumers will feel as though oil has hit $160 a barrel, because a lack of capacity at refineries means gasoline and fuel prices are rising more than would normally be expected, adding to costs across the economy, foreign media reported.

Gasoline and diesel prices in the UK continued their ascent over the holiday weekend, reaching record-highs yet again. The average price of gasoline rose to 177.88 pence (Rs452) a liter on Sunday. Diesel prices increased to185.01 (Rs472) pence a liter.

British automotive services company RAC fuel spokesman Simon Williams, meanwhile, said: “With analysts predicting that oil will average $135 a barrel for the rest of this year, drivers need to brace themselves for average fuel prices rocketing to £2 (Rs510) a litre, which would mean a fill-up would rise to an unbelievable £110.”