Price stability crucial, say Saudi Arabia, Qatar
Sep 21st, 2008 | By Oil and Gas | Category: Latest News, Oil and Gas Production
Crude oil’s fall in recent months will help support a sagging world economy but current prices do not reflect fundamentals and need to be at a level that encourages investment, two Opec (the Organisation of the Petroleum Exporting Countries) producers said in New Delhi.
The global financial crisis, the worst since the 1930s, has pushed much of the industrialised world into recession, causing oil demand to slump and crude prices to tumble by more than $100 from its record peak above $147 a barrel last July.
Saudi oil minister Ali Al-Naimi told delegates at the Petrotech conference oil prices should be stable and more predictable, and added he was especially committed to the needs of growing Asian markets.
Qatar’s oil minister Abdullah Al-Attiyah suggested a target price of $70, which is about 80 per cent higher than the current level, to encourage investment, while Angola’s deputy oil minister said nobody was happy with the present level of prices. “Stability means oil prices maintained at a level that encourages investment, helping create a climate conducive for the development of all viable energy sources,” Naimi said.
Naimi said on the sidelines of the conference that the world’s top exporter would cut output next month to below its Opec target and was prepared to go even further to arrest the fall in prices. Talks of production cuts and cold weather in the US helped oil rise 3 per cent towards $39 a barrel although it later slipped back below $38 after news of worse-than-expected US retail sales figures depressed stock markets and hit the dollar. “The price of oil has declined in recent months by more than 70 per cent since reaching their highest level in July – a drop that will play a major role in aiding economic recovery,” Naimi said. Qatar’s Attiyah said $70 a barrel was the right price for oil to keep companies and producers investing in new resources.
( source: www.oilandgasnewsworldwide.com)
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