Institut Fran

PARIS, Aug. 31 — Faced with lofty world crude oil prices, reflecting a perception of tight fundamentals and threats to supplies, Paris-based Institut Fran

These higher oil prices also have sparked off the first signs of inflation in oil-exporting countries within the Organization for Economic Cooperation and Development, IFP observed.

The decisive factors influencing prices, noted IFP, are growth in demand, the rate of utilization of production and refining capacities, and outside factors such as geopolitics, winter weather conditions in the northern hemisphere, and hurricane development in the Gulf of Mexico.

Whatever the scenario, however, production from nonmembers of the Organization of Petroleum Exporting Countries should maintain a global increase of 1 million b/d/year in 2004 and 2005 to level a level of 50-51 million b/d, IFP said.

Price scenarios
IFP has forecast three different scenarios to yearend 2005 by taking into account the dominant market features: continuation of the current trend with sustained demand in a relaxed geopolitical context; a new “oil crisis” scenario with a significant and lasting interruption of exports from a large oil producing country; and a “soft landing” scenario where oil demand slows down strongly because of the delayed impact of high energy prices on the economy.

The first reference scenario is a continuation of the current trend