Why does Commodity Broking rule out oil crossing $120/bbl?

Jonathan Barratt, MD of Commodity Broking Services gave CNBC-TV18 his expert opinion on where he sees crude heading from hereon.

On the back of the Middle East North Africa (MENA) crisis, he says that even if the Libyan crisis quietens down, Algeria is the next country to watch out for from that region, as it produces around 2 million barrels of crude. "We feel that if the unrest starts to spread to Algeria, then we do have a slightly more concern because Algeria has a similar form of government to Egypt," he adds. While volatility is still in the crude oil price, he is certain that Libyan leader Gaddafi will come to the table. "As a result of that we should see stable prices back to USD 100, if not below. " Below is a verbatim transcript with CNBC-TV18's Latha Venkatesh and Gautam Broker. For the complete interview watch the accompanying video. Q: We have seen cooling off prices on both Nymex and Brent. Should one suspect that now we could see it going all the way down below USD 100 or do you think the situation remains very volatile as of now? A: Tthe situation remains very volatile. We are hearing stories that Gaddafi is looking for some form of resolution that I guess whilst we are unclear to what he is actually saying, the markets are feeling that this resolution could see prices under a little bit of pressure. Q: What is the newsflow from the other MENA regions because even if the Libya problem subsides, you have the other countries that are being currently watched? A: Yes, we have. What we are concerned about is what is happening in Algeria. Algeria in itself produces pretty much close to 2 million barrels. We feel that if the unrest starts to spread to Algeria, then we do have a slightly more concern because Algeria has a similar form of government to Egypt. If in fact things do start to become a concern and I do wish to dispose of that later then that will give us more of a concern. At the moment, however, the markets are taking a little bit of a breather, certainly, from those highs that we have not seen for such a long time. Q: If the negative newsflow from this region were to subside where do you think prices could stabilise? A: Let