Posted on 03/10/2008 8:33:35 AM PDT by Froufrou
Oil prices will stay at current high levels for the rest of this year due to speculation and geopolitical tensions, Algerian state media on Monday reported OPEC President Chakib Khelil as saying.
Prices could retreat in 2009 with a recovery of the U.S. dollar in foreign exchange markets following the election of a new U.S. president, and as fundamentals reassert themselves as major market forces, he was reported as saying by government newspaper El Moudjahid and state news agency APS.
"Just like the current surge in oil markets, the (world economic) crisis, will last until the end of the year," he was quoted as saying by El Moudjahid.
"The oil market will stay above $100 during the current financial year, according to the assessment of Mr Khelil," APS said in a report on his remarks to Algerian reporters on Sunday.
It was not immediately clear which fiscal year APS was referring to.
Khelil, who is also Algerian Energy and Mines Minister, said the factors driving the market at present included "speculation, geopolitical tensions, particularly due to the Iranian nuclear affair and the crisis between Venezuela and ExxonMobil," APS reported.
The world economy could get some help with the arrival of a new U.S. president, and possibly a new economic policy, "and with this new situation it is very probable that the dollar will start to recover and thus permit a readjustment of the (oil) market," El Moudjahid quoted him as saying.
OPEC members meeting in Vienna last week decided to hold production flat, insisting markets were well supplied and blaming record prices on factors outside the group's control, including speculators and what Khelil called the "mismanagement" of the U.S. economy.
Speculators have piled into oil and other commodities as a hedge against the weaker dollar and inflation as the U.S. economy slows due to a credit crunch, the mortgage crisis and high energy costs.
Khelil said OPEC had left output unchanged because it wanted to assist global economic growth, El Moudjahid and APS reported.
The group made its decision in the knowledge that demand was expected to dip by 1.4 million barrels per day (bpd) in the second quarter of the year and that stocks in consuming countries were at comfortable levels, Khelil said.
"If we had increased our production given all these factors, you wouldn't have been able to miss the impact on prices," he said, suggesting prices would have slid.
"We left our output unchanged so as not to disturb the market further and to help the world economy resume its momentum of growth," El Moudhajid quoted him as saying.
Personally, I think we Republicans have no choice but to get on the train and start working towards the alternative technologies. Because we just can’t afford to stand for being led around by the nose this way.
If they balk, tell them we have to do these things in order to 'afford' their oil.
These folks are risking a global recession. Also, the planet looks more stable than it has been in a long time, so this thing about geopolitical tensions just doesn’t wash.
We may, in fact. be reaching “peak-oil” at least over available, developed supply. They control the currently developed supply. They know that Democrats will never develop domestic sources, and will simply make noises about conservation, mercury filled light bulbs, ethanol, and more conservation.
Soon we will be like Europe and elsewhere world, and will be stumbling down dark stairwells and driving tiny cars and motorcycles while paying hyper-high rates.
I found this cute little question in a page of the November, 2005 issue of Power Engineering entitled “What Oil Shortage?” and it is as follows:
What Oil Shortage?
A lot of folks can’t understand how we came to have an oil shortage in our country.
Well, there’s a very simple answer.
Nobody bothered to check the oil.
We just didn’t know we were getting low; and the reason for that is purely geographical.
Our oil is located in:
Alaska
California
Coastal Florida
Coastal Louisiana
Kansas
Oklahoma
Pennsylvania
and
Texas
Our dipsticks are located in Washington, D.C.
MFO
Goody, listen to what you said! What’s the difference between oil and food? That, in theory, we can ‘do without’ oil.
Of course, mysterio correctly points out in order to pull off a successful boycott, we have to utterfly stop consumption. I’m not sure Americans are ready for that, but what a heckuva statement it would make if we could pull that off! Even if just for a week or two!
Allow me to educate: Our fiscal policy to avoid a collapse of the entire U.S. banking system was to drastically reduce short-term rates in the hopes Central Banks would lend money to each other again. Instead, banks are hoarding cash to fix their nasty balance sheets, meaning people with good credit like me can’t get business loans and fix the economy (U.S. economy is now 80% small business). The other side effect of this policy is that as the interest rate is slashed, this weakens the dollar. It costs XX% more to buy imports. Where do we get our oil? Imports. Blame Congress & the Fed along with this WH for DOING NOTHING but make bad decisions. I don’t pin this one on the Arabs trying to sway elections. That is a given, but the Arabs (minus Al Queda and Iran) like Republicans in power, not Democrats.
Oz, ~snorrfle!~ Loved that!
WG, You seem hauntingly familiar, do I know you? ;o)
I agree with you except that many Europeans don’t drive. That bike to the trains and back.
Yuh know, maybe Carter’s program of synfuels was a good thing, getting all of us from the al-queda sympathizing sheiks, but Reagan listened to his “true” conservative advisor, David Stockman, and the rest is the history that we are living in now.
Soon (meaning 4-5 years from now) we will either elect responsible politicians that love America first or We the People shall reclaim our government the hard way. I hate bloodshed, but I don’t think many Americans know what is just starting to hit them and soon will crush them. This economy is in total shambles and the blame is on ourselves this time, not the Soviets or CHiComs or Arabs oil producers as a whole.
It’s not easy to drain praise from Reagan around here, but what you say is true and undoubtedly he contributed to AIDS statistics by refusing to fund research. [source: And The Band Played On.]
His guess is as good any anybody's.
Funneee...but I’m pretty sure it was more threat than guess!
OPEC knows it is irrelevant. They have no control at all. Bluster at most.
Actually, if Obama or Hillary get in, they will totally mismanage the economy to the point where world-wide demand will shrink at least 20%. Wonder what the price per barrel will be then...
Well, of course, because the Buchannite caucus on FR, discreetly forget that Reagan fired Buchanan in 86, but still priase Reagan, even though Reagan turned tail in Lebanon in 83 to the terrorists.
Three words: Solar. Tax. Incentives.
Except that we use oil to produce and ship the food. When oil is more expensive, so is food (and everything else).
For $25 a month, I’ll park my freakin’ Envoy and ride the bus! Maybe even get a bicycle and get my thighs in shape for swimsuit season.
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