The worst-case scenario regarding the price oil just became, well, a little worse.

On Thursday CIBC World Markets Chief Economist Jeff Rubin said oil production will barely grow over the next five years, and that shortfall, combined with solid emerging market demand, will drive oil to $150 per barrel by 2010 and $200 per barrel by 2012, and The Financial Post reported Thursday.

Just as bad, and despite easing gasoline demand in the United States, U.S. gasoline prices will climb to as much as $7 per gallon by 2012, Rubin said, and The Financial Post reported.

Fortune has added a new phrase to my vocabulary: liquidity puts. In an interview with Citigroup Inc. (NYSE: C) Chairman Robert Rubin, liquidity puts are defined as the right of Collateralized Debt Obligation (CDO) holders to sell back the CDO to its issuer at the original price. The liquidity put is responsible for the $25 billion worth of CDOs on Citi's balance sheet.

Before getting into how this all works, it is amazing to me how many new words I've learned as a result of the collapse of the real estate market which began in the fall of 2006 -- when I first began posting on the topic. Since then, I've been introduced to all sorts of new terms -- subprime mortgages, CDOs, Structured Investment Vehicles (SIVs), the Yen Carry Trade, and Level 3 assets -- to name just a few.

When Citi set up its $80 billion worth of SIVs, it thought that they would stay off its balance sheet. This summer, though, financial markets lost interest in financing CDOs so the holders of the liquidity-put CDOs began to return them to Citi -- the $25 billion of them represent more than half of Citi's $55 billion of subprime-related securities. The super-senior status -- meaning that they got first claim on cash flows -- of the put-laden CDOs did not protect their value because the ratings agencies decided to downgrade them, creating a panic to exercise the put and sell the CDOs back to Citi, thus locking in huge losses for the bank.

As an investor, I am hoping that Robert Rubin's vanity -- I think his once sterling reputation has been tarnished -- will engage him in fixing Citi. But I wonder whether Citi's problems could be too big for him to fix.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He owns Citigroup shares.

Citigroup (NYSE: C) may have a new leadership team, but don't expect any miracles [subscription required]. In a conference call yesterday with CFO Gary Crittenden and the new Citigroup chairman Robert Rubin, analysts were told that Citigroup would not be able to clean up its problems related to the mortgage and credit mess until the middle of 2008. Citigroup expects to write down between $8 billion and $11 billion in the fourth quarter, but that could go even higher.

Crittenden did repeatedly try to assure investors that the dividend level would be maintained, saying, "Based on our current assumptions, we do expect that we will be maintaining our current dividend level. We have no reason to think that is anything other than absolutely the case and we anticipate that we will return to the range of our targeted capital ratios by the end of the second quarter 2008."

The question is how sure are they? They admit that most of what has unfolded happened through the month of October and that the potential losses for Citigroup raked up by its banks and investment houses could total more than $30 billion. When asked by Mike Mayo, an analyst for Deutshe Bank, "In the terms of the charges, can you give us any assurances that there is not another shoe to drop?" Crittenden answered, "Well, no Mike, I obviously can't give you any assurances. By the very nature of what I have said through this call, we are making an estimate right now ..."