OPEC policy will hit the poorest hardest, says IEA chief

PARIS (AFP) – The head of the International Energy Agency (IEA) criticised OPEC for setting a target price of around 70 dollars per barrel, saying in an interview published Tuesday that it would hit the poorest hardest.

“The market is clearly aware that OPEC has set itself a new implicit price target or a new price band of around 70 dollars (51 euros) per barrel and that the organisation will endeavour to defend this level,” Claude Mandil told Arab Oil and Gas review.

“I deplore this, because it is a factor that could, whatever people often say, weigh on world economic growth and which represents a very heavy burden for the poorest people and the poorest countries,” he added.

Mandil said oil stocks should continue to rise with oil consumption growing by around two percent a year on average.

OPEC is correct to say that the oil market is well supplied, “but what interests us above all is tomorrow’s market, which is to say the end of 2007,” he said.

“More crude oil is needed, therefore, but unfortunately the signals being sent out by OPEC do not leave us much hope in that regard,” said Mandil.

AFP