OPEC chief: Oil prices would go higher regardless of supply

ROME — OPEC Secretary-General Abdullah el al-Badri said Sunday oil prices would likely go higher and that the group was ready to raise production if the price pressure was due to a shortage of supply _ something he doubted.

"Oil prices, there is a common understanding that has nothing to do with supply and demand," al-Badri said on the sidelines of an energy conference in Rome.

Oil prices reached a new high Friday at $117 a barrel.

A host of supply and demand concerns in the U.S. and abroad, along with the dollar's weakness, have served to support prices, even as record retail gasoline prices in the U.S. appear to be dampening demand. Crude prices have risen as much as 4 percent last week.

The OPEC chief said the Organization for Petroleum Exporting Countries "will not hesitate" to increase production if the group thought the higher prices were due to shortages. But he said more oil will not solve the high prices.

OPEC's production levels were just one of many factors, he said.

"But how much higher it will go, of course it depends on a number of things: the political situation, whether there is a natural catastrophe, whether there are speculations in the market, whether there are strikes in certain producing countries. So there are many other factors other than OPEC production," al-Badri said.

Comments

[Zhonni]

I think I agree that no matter the supply the high crude prices are here to stay. China and India are needing more energy to develop thus the high price of gas. The weakness of the dollar isn't helping matters either.

I think we may never see crude below $80 unless we fundamentally change our consumption.

[LivingStardust]

Saudi Arabia - The Other White Meat

Sleep tight, Enemies of the U.S., because when We the People get control of the government again, you thieves and killers are screwed.

[fourex]

leftright/ "It's only been recently that the dollar has fallen" This statement is false.
The dollar has dropped around 50 % against Euro starting in 2002. Article from 11/07 says 5 year drop against Looney is over 60%.

[bgregs]

But look at the rate, it may have started around 2002, but it's only been since 06 that it did the most of the drop against the Euro. By contrast, the price of oil was already up around $90 by 06.

[fourex]

"Oil prices, there is a common understanding that has nothing to do with supply and demand," al-Badri said on the sidelines of an energy conference in Rome.

Thank you al-Badri. There have been a thousand posts here claiming falsely that supply and demand have caused the increase, when it is clearly monopoly and speculation.

[fillou]

How do you say "Jackpot Mega Bingo" in Arabic ? It's called Bushism ...

[gcallaghan]

As the value of the dollar plummets the cost of everything rises, oil not withstanding.

[swift goat pet for truth]

The GOP argument.

OPEC: Oil prices will rise, regardless of supply. No mention of the magnitude of the rise. Or the causes, which is the loss of the dollar's buying power, due to Fed and private debt.

GOP: Clinton had growing employment, Bush has growing employment. Its the same. (Clinton had 22 mil jobs in 8 years, Bush had 5 mil new jobs in 7 years. It's the same)
Bush had deficits, Clinton had deficits. Its the same. (again, its a question of magnitude)

Increasing the supply will bring the price down. It probably would not bring the price down to, say, $50 / bbl, but it will bring the price down.

[javaman]

Well, it is THEIR oil after all. they can do with it what they please. funny, as americans, we get pissed off when the pusher raises the price of our fix.

here's a clue: use less.

[mamacat]

One of the factors to consider re the price of oil to Americans, is the collapsing value of the dollar. The price of oil in Euros has not gone up as much during Bush's reign as it has in American Dollars.

If sound economic and foreign policy could be restored, the dollar would stop collapsing, eventually. Unfortuneately, so much damage has been done to the economy and to our foreign policy, that it will take time to correct.

I suspect that as soon as things start getting better, in 8 or 12 years, the Republicans will be able to use their scare tactics to get back in office again, and then the cycle of "destroy the economy" and "build it back up" will start all over again.

[LeftRight]

However, the price of oil had its largest rise BEFORE the dollar started to collapse. It's only been recently that the dollar has fallen, even though the price of oil was already up over $90/bbl!

[fourex]

LeftRight "It's only been recently that the dollar has fallen" Pure garbage.

The dollar traded around 1.18 Euros in 2001 now .63. That's nearly a 50 percent drop in 7 years.

[mediamarv]

Classic Republican market forces at work... almost as succesful as the Surge, wouldn't you say??

[MetalCanuck]

I can just sit back and watch, America had its chance with Ron Paul...now everything he warned about is going to happen. Maybe people should have voted for someone who knows what their talking about. The top 3 as they call them are nothing but CFR phonies.

[thegreatgiginthesky]

Let's keep growing China's manufacturing base, this way we can make sure that the price of oil hits $10 a gallon. Don't you just feel the freedom when you are pumping gas into your car?

[WIpatriot]

THE GREAT OZ HAS SPOKEN!

[Rule Of Law]

So, this whole supply and demand thing--explain that again Abdullah ?

(I'm back...heh heh)

[WIpatriot]

Abdullah : "I got the supply, you got the demand. The first hit is free."

Glad you're back, Rule!

[Philbee1970]

Oil is only going to get more expensive. We didn't need to invade Iraq to conquer its oil; there is more oil in Alaska than in Saudi Arabia, and we this has been known since 1973. In 1973, ARCO pulled a drilling rig out to Gull Island, a small islet at the very northern limit of the 10 sq mile area the federal government had opened for drilling in Alaska's Prudhoe Bay. The well ARCO drilled tapped into the edge of a different pool of oil from what they had been producing from further south in Prudhoe; it had a different chemistry. ARCO execs became giddy after the find was tested, and started talking amongs themselves and others within earshot about America being independent from Middle Eastern oil. Within days, the execs told everyone that the government had ordered the well capped, the records of the find sequestered, and anyone who was privy to the find was ordered to keep quiet about Gull Island. One of those present wrote a small book about it:

The Energy Non-Crisis
By Lindsey Williams
You can read the book in its entirety here:
http://www.reformation.org/energy-non-crisis.html

Between Gull Island, the nearby Kuparak field, and what's left in Prudhoe Bay, we could be independent of our Arab oil masters, and use the profits from the oil to fund the energy alternatives and technology that would improve our energy efficiency and eventual oil independence.

[WIpatriot]

Sure, but we have to wait 'til oil hits $200/bbl so when the oil companies tap into tit, they can make super-record profits!

[ErnestineBass]

Fine.

What will we do with all that cheap, plentiful oil?

Will we invigorate our manufacturing base...or will we just drive down to Wally World for a third monster teevee made in China? Or South Korea? Or Indonesia?

What WILL WE DO?

What will we do?

[mamacat]

I would like to be able to dismiss your claim out of hand, but, having seen what the Oil Companies are capable of first hand, I cannot.

[luckyoldson]

Anybody who thinks there is more oil in Alaska than in Saudi Arabia is delusional.

Greatest Oil Reserves by Country, 2006 - Billions of barrels:

1. Saudi Arabia 264.3
2. Canada 178.8
3. Iran 132.5
4. Iraq 115.0
5. Kuwait 101.5
6. United Arab Emirates 97.8
7. Venezuela 79.7
8. Russia 60.0
9. Libya 39.1
10. Nigeria 35.9
11. United States 21.4

[chronic]

Oil prices are expected to continue their upward march. It recently crossed the $100/barrel threshold that energy analysts have predicted. Their next prediction: “Black gold” could reach price points up near $200 within 12 months.





http://www.moneymorning.com/ppc/oil_2008_je9.html?gclid=CMz_y8zo6pICFQFqlgodgQyf4Q

[ErnestineBass]

At the rate it's currently rising, chronic, I fully expect oil to hit that benchmark by Thanksgiving.

How's that for irony?

heh heh