OPEC predicts further rise in oil prices in weeks ahead

July 6th, 2008 - 9:11 pm ICT by IANS  

Algiers, July 6 (Xinhua) The oil prices are likely to increase further, largely due to a weak dollar and geopolitics, Chakib Khelil, president of the Organisation of Petroleum Exporting Countries (OPEC), said Sunday. “The price of oil will rise again in the coming weeks. We have to follow the evolution of the dollar, because a one-percent fall in the dollar means $4 more on the price of oil,” Khelil said in an interview with Algeria-News.

The Algerian minister of energy and mines also highlighted the geopolitical impact on oil prices, noting the current crisis between Iran and the West over its nuclear programme as well as the previous sanctions on Libya.

“The ban imposed on Libya has prevented any increase of investment in that country, just as the current embargo on Iran is stopping investments there,” Khelil said.

“The US is threatening tough economic sanctions against any group who dares to invest in Iran. Similarly, the war in Iraq has blocked investments in that country. No OPEC country can invest in embargoed countries,” he said.

“I believe 60 percent of the rise in the oil prices is due to the fall in the exchange rate of the dollar and to geopolitical problems, and 40 percent to the intrusion of bio ethanol on the market,” he said.

The minister denied accusations by some western countries that insufficient supply of oil from producer countries is causing the soaring prices.

“As producer countries we think the current supply is sufficient. This balance in supply is in everybody’s interests and shouldn’t be disturbed,” he said.

“The current rise in oil prices is in nobody’s interest,” he added.

Khelil said last week that the Vienna-based cartel would increase its output to 52 percent of the global oil supply by 2010 from the current 40 percent.

Earlier on Thursday, the price for crude oil produced by the OPEC had jumped above $140 a barrel.

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