Oil on the way to $100 a barrel?
Oil importers are growing wary of the impact of prices near two-year highs as some OPEC members foresee a further rally to the $100-a-barrel...
CAIRO — Oil importers are growing wary of the impact of prices near two-year highs as some OPEC members foresee a further rally to the $100-a-barrel level and Arab oil ministers gather for a meeting this weekend in Cairo.
Japan's economy minister said Friday the government needs to keep an eye on what he called "very expensive" oil prices, while the deputy governor of the Chinese central bank said inflation pressures are rising.
Shokri Ghanem, chairman of Libya's National Oil Corp., was the latest OPEC official to forecast $100. Iran and Venezuela have also said that represents a fair price, while Saudi Arabia, the group's biggest exporter, said it prefers prices centered on $75, a level that oil has traded above since September.
"An issue for OPEC will obviously be prices edging higher," said Bill Farren-Price, chief executive of Britain-based consultants Petroleum Policy Intelligence. "The issue is whether we're in a new rally, and for now the jury's out on that."
Crude oil for February delivery advanced $1.03 to $91.51 a barrel yesterday on the New York Mercantile Exchange, the highest since Oct. 3, 2008. Prices are up 15 percent this year.
Ghanem, Libya's top oil official, made his $100-a-barrel prediction in Cairo on Thursday, before a meeting Saturday of the Organization of Arab Petroleum Exporting Countries.
OAPEC, as the Arab group is known, includes several members of OPEC (Organization of Petroleum Exporting Countries), the broader 12-nation group that influences prices by setting supply quotas.
OAPEC was established in 1968 to foster the development of the petroleum industry in member states as part of an economic integration plan among Arab countries. It contains seven nations that are also within OPEC.
OPEC, which accounts for 40 percent of global oil supply, decided at its last meeting in Quito, Ecuador, on Dec. 11 to maintain its production target of 24.845 million barrels a day, set in 2008.
OPEC's next formal meeting is scheduled for June 2011.
But it may meet before its next regularly scheduled gathering in June, Iraqi Oil Minister Abdul Kareem al-Luaibi said Friday.
He also said he is "happy" with the current price of oil and that Iraq's output in 2011 will be 1.5 million barrels a day.
Iraq, Libya, Saudi Arabia, Qatar, Kuwait, the United Arab Emirates and Algeria are all members of both OPEC and OAPEC.
Global oil consumption is expected to rise to a record level next year, according to the Paris-based International Energy Agency and other forecasters.
Saudi Arabian Oil Minister Ali al-Naimi arrived in Cairo on Friday without commenting to reporters. He said in Quito on Dec. 11 that oil at $70 to $80 a barrel is a good price, that the market is stable and supply and demand are in balance, while Kuwaiti Oil Minister Sheik Ahmad al-Abdullah al-Sabah said then that he was satisfied with prices near $90.
Qatar's Oil Minister Abdullah bin Hamad al-Attiyah has said oil in the $80s is best for producers and consumers. Algerian Oil Minister Youcef Yousfi said at a conference in Doha on Dec. 1 that the market is in a "normal situation" and prices are likely to be stable for months.
Some Wall Street strategists expect prices will return to $100 for the first time in two years during 2011 amid rising global demand.