Editor's letter

Since the recent fall in the price of oil, talk is rife about whether the bull run is over for the time being. Prices have dropped 30% since all-time highs in July, due, many analysts say, to an unwinding of the risk premium. Fears that hurricanes and heightened geopolitical tensions would cause supply disruption added up to $15 a barrel to the futures price, some analysts estimated.

Most agree that oil prices are now a much better reflection of supply and demand fundamentals, and many expect prices to continue falling next year on signs of a weakening US economy. 2008 could see a further fall in price as new supply hits the market. However, as the lead article in our special report on oil reveals, a few analysts, most notably those at Goldman Sachs, UBS and Barclays Capital, expect higher oil prices in 2007. Looking further out, other experts believe it is highly unlikely the much-awaited supply increases will materialise in the quantity and timescale that most reports suggest.

The problems of infrastructure and personnel bottlenecks are discussed on page 32 of our oil report. The report also takes in Canada's oil sands business, looking at the potential and challenges of this capital-intensive business, which needs a high oil price before it is viable.

The same goes for many alternatives to oil. This month's cover story (page 18) reports on the latest investment finance trends in the clean energy technology field.

Finally, I'd like to say a big thank you to all of the delegates and sponsors who attended the Energy Risk Europe conference in London on October 3-4.