Rick Rule – Oil Super-Spike Will Take Gold & Silver Higher
March 20, 2012
With gold and silver hovering above recent lows, but oil moving towards the critical $110 level, today King World News interviewed Rick Rule, CEO of Sprott USA. Rule told KWN to expect higher gold and silver prices, but warned about the possibility of a super-spike in oil. Here is what Rule had to say: “The strength in the crude oil market has been caused by continued political nervousness surrounding the situation in Iran. The saber rattling between the United States, Iran and Israel is something which has had refiners and oil users very nervous.”
Rick Rule continues:
“Obviously the Iranians could shut down the Straits of Hormuz for a short period of time and KWN readers should note that 60% of the world’s crude oil flows through that very tight body of water. Yesterday Iraq also mentioned they were looking for other export avenues for their oil, either through Turkey or connecting through Saudi Arabia. So the perception in the Gulf with regards to the Straits of Hormuz being closed is very real.
The price of oil being at these lofty price levels is causing demand destruction. People are beginning to moderate their consuming habits as a result of these oil prices. Now, oil demand is only elastic to a certain degree because so much of our lifestyle involves gasoline….