Oil investment at risk, threatening new price surge

LONDON (Reuters) – The falling price of oil and credit crunch are delaying projects to expand output, industry officials said on Tuesday, risking a strain on future supplies that could send prices soaring.

Oil has fallen sharply to below $65 a barrel from a record high of $147.27 struck in July, due mainly to a drop in demand. At the same time, the credit crunch has made raising finance more difficult.

“I’m seeing a lot of projects being postponed because the finance is no longer there,” Qatar’s Oil Minister, Abdullah al-Attiyah, said at a conference in London.

“This is my concern — how to build capacity to cope with future demand.”

Reuters