Gulf oil producers stance appears vindicated

The UK has offered to host another meeting of oil producing nations and consumer countries following the energy summit in Saudi Arabia to assess progress from discussions initiated during the conference in Jeddah. The meeting, if it goes ahead, is likely to be conducted in a less confrontational atmosphere than the conference in June.

OPEC countries, which supply about 40 per cent of world crude production, have already responded by increasing oil production by 350,000 bpd to 32.4 million bpd, with Saudi supply rising to 9.45 million bpd. Exports from offshore storage have also lifted Iranian supply to 3.8 million bpd.


Following Goldman Sachs’ prediction that crude prices could hit $200 a barrel before the end of 2008, analysts at Lehman Brothers are now saying they believe oil prices have reached ‘a tipping point’, with forecasts that the price per barrel will ease to $110 by the fourth quarter and decline further to $90 early in 2009.

Qatar’s oil minister Abdullah al-Attiyah, the GCC’s and OPEC’s longest serving petroleum minister, has been among the most vocal arguing that speculation in energy markets has been the biggest driver in the rise in the price of oil this year which peaked at $147.27 on July 11.

OPEC’s recent annual report states that the trade in ‘paper barrels in regulated oil futures and unregulated over-the-counter exchanges has expanded dramatically in recent years’.

AME Info