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World can cope with oil price at US$100
By Sherine El Madany |
December 27, 2010, Monday
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Print Edition
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THE global economy can withstand an oil price of US$100 a barrel, Kuwait's oil minister said on Saturday, as other exporters indicated OPEC may decide against increasing output through 2011 as the market was well supplied.
Analysts have said oil producing countries are likely to raise output after crude rallied more than 30 percent from a low in May because they fear prices could damage economic growth in fuel importing countries.
European benchmark ICE Brent crude for February closed at US$93.46 last Friday after hitting US$94.74 a barrel, its highest level since October 2008.
Arab oil exporters meeting in Cairo last weekend said they saw no need to supply more crude as stocks were high and prices had been inflated temporarily by cold weather in Europe.
Asked by Reuters if the world economy could stand a US$100 oil price, Kuwaiti Oil Minister Sheikh Ahmad al-Abdullah al-Sabah said: "Yes it can."
Iraq's new oil minister and the head of Libya's National Oil Corporation both said US$100 was a fair price, while Qatar's Abdullah al-Attiyah said he did not see OPEC hiking output in 2011.
"I do not expect an OPEC meeting before June because oil prices are stable," he said.
Some delegates even called for exporters to comply better with agreed production limits. OPEC members' compliance with promised cutbacks hit 56 percent in November, according to Reuters estimates.
When asked if output could be raised, Kuwait's Sheikh Ahmad said: "No. More compliance, more compliance."
OPEC cut output drastically after the global financial crisis struck in 2008 to prop up collapsing oil prices.
Analysts have said oil producing countries are likely to raise output after crude rallied more than 30 percent from a low in May because they fear prices could damage economic growth in fuel importing countries.
European benchmark ICE Brent crude for February closed at US$93.46 last Friday after hitting US$94.74 a barrel, its highest level since October 2008.
Arab oil exporters meeting in Cairo last weekend said they saw no need to supply more crude as stocks were high and prices had been inflated temporarily by cold weather in Europe.
Asked by Reuters if the world economy could stand a US$100 oil price, Kuwaiti Oil Minister Sheikh Ahmad al-Abdullah al-Sabah said: "Yes it can."
Iraq's new oil minister and the head of Libya's National Oil Corporation both said US$100 was a fair price, while Qatar's Abdullah al-Attiyah said he did not see OPEC hiking output in 2011.
"I do not expect an OPEC meeting before June because oil prices are stable," he said.
Some delegates even called for exporters to comply better with agreed production limits. OPEC members' compliance with promised cutbacks hit 56 percent in November, according to Reuters estimates.
When asked if output could be raised, Kuwait's Sheikh Ahmad said: "No. More compliance, more compliance."
OPEC cut output drastically after the global financial crisis struck in 2008 to prop up collapsing oil prices.
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