As if record-high gas prices weren’t enough, CNN’s “Your $$$$$” speculated about “what if” oil were to spike to $200 a barrel.
“Well, if you think it is bad now, it could get worse and it could get worse pretty fast. Fasten your seat belt; fill ’er up, because as you say, it could get a lot worse,” special correspondent Frank Sesno told host Ali Velshi on the May 10 show.
Yes, $200 a barrel, Sesno said: “Hard to imagine? Think again.”
Sesno said with oil at that level, prices at the pump would reach $6 per gallon. Other analysts have concluded that prices will settle far before we reach that extreme prediction.
The $200 mark is the new media fantasy. A recent NBC News report insinuated CNBC contributor John Kilduff was predicting that price, though on CNBC’s “The Call” the same day he suggested oil would top out in the $130s per barrel.
Though his numbers were merely figments, Sesno worried viewers with the ripple effects of such pricey oil. Venezuela’s Hugo Chavez “has threatened it,” he said, while “prominent Wall Street analysts” think “there is a high likelihood oil could go to $200 a barrel and beyond.” And were prices to reach this level, food, heating oil, transportation and refrigeration would all experience accelerating price increases.
Sesno conceded that “a lot of people dispute this $200 a barrel scenario,” but didn’t include any of those people in his report. On the contrary – he featured industry analyst Matthew Simmons, famous for his “peak oil” view that world oil supply has already reached its highest point.
“A lot of people dispute this $200-a-barrel scenario. They say there’s plenty of oil,” Sesno said. “But $200, even $300-a-barrel oil is a what-if scenario people ignore at their peril, argues Matthew Simmons…”
Simmons told viewers, “This is the biggest threat to sustainability of the 21st century and it’s right on our doorstep. It’s not two years away, it’s here, and it’s in our front room.”
Sesno concluded: “Cheap oil’s done. $100 a barrel may end up looking like a bargain in a very short time.”
As has become so common in media coverage of rising gas prices, Sesno brought up oil company profits. “Some will make money,” Sesno said of the oil price rise. Simmons continued, “Oil company profits, like it or not, are gonna go through the roof.”
The Business & Media Institute has found that network reporters covered oil companies’ profits 14 times as often as they covered the profits of OPEC – an actual cartel that controls supply and directly affects prices.
Velshi said CNN had been “polling extensively to see where our viewers think gasoline prices are going.”
“Our viewers think we’ll hit $5 a gallon this year.” No wonder.
Amy Menefee contributed to this report.