OPEC chief says oil price will stabilise soon

PRICE PREDICTION: OPEC president says crude prices will stabilise by February 2009. (Getty Images)

Crude prices are expected to begin stabilising within the next two months, OPEC president said on Saturday.

Many OPEC member states have started reducing oil supply in line with the group's biggest-ever output cut agreed earlier this month, he added.

"Many countries have implemented the reduction. I think all of them will implement it because they do not have a choice," Chakib Khelil told Algerian state radio.

The Organisation of the Petroleum Exporting Countries agreed on Dec.17 to reduce supplies by 2.2 million barrels per day.

"I think this reduction will have an impact on prices in January-February because it is a strong reduction," Khelil said.

"We seek to stabilise the price and prevent it from falling further. I think we will reach this stabilisation in January-February, God willing," he added but gave no forecasts for prices in the next two months.

Oil prices were at $37.69 in London on Friday.

Khelil, also Algerian energy and mines minister, said he expected the level of stocks to be brought to 52 days by the end of 2009.

"I think the organisation will be stronger in the future. OPEC, with 40 percent of the world's oil currently, may have 50 percent within 10 years," he said, citing falling oil reserves in some non-OPEC countries. (Reuters)

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READERS' COMMENTS

RE: shame on opec
Posted by sam on Saturday 3 January 2009 at 01:59 UAE time


In your comments, you forgot to include the cost of refining. To compare apple to apple, I can get a barrel of water from a lake for free, vs. $150 for a barrel of crude at its heights.

shame on opec
Posted by magasebibak on Sunday 28 December 2008 at 04:41 UAE time


Shame on OPEC and non-OPEC exporters oil countries!

A barrel of crude oil is cheaper than bottled water in supermarkets.

In mostly all western European countries a bottle of one and half litres of water costs 0.70 Euros. In order to compare both prices you need to buy 106 bottles of water to get 159 litres, equivalent to a barrel of crude oil, so 106 x 0.7 euro = 74.20 euro
Now we have to change euro to dollar so, 74.20 euro x 1.4 = 103.88 dollars.

As you can see, you have to pay 103.88 dollars to get 159 litres of bottled water, but you only need 35 dollars to get a barrel of crude oil.
80% of the income of countries like Saudi Arabia, Iran, Kuwait, Arab Emirates, Iraq, Venezuela, and almost the rest of the oil exporters’ countries is based on the sale of this raw material.
Oil is a very scarce good and the leaders of these countries must act with caution and responsibility in order to benefit their economies because their political stability and well-being of their citizens depends on it.
These countries have been selling their oil at a loss for the last 100 years ($8 pb, $10 pb, $20 pb and now $35 pb). They have given their oil to industrialized countries and these ones have become economic and military leaders.
The oil reserves in operative oilfields started declining years ago but the world needs and demands more and more oil year after year. In the last 20 years, we haven’t discovered any important oilfields and the new ones are very difficult and very costly to operate. Most of them are placed in far open sea and in very deep water sea. The other ones are placed in land but in abysmal depths with low capacities.
What would the political leaders answer to this question from their citizens in 10 or 15 years?

Why have you been selling our black gold cheaper than water?

$100 barrel is too cheap for something that moves the world and that is so scarce.

How long do you think that the price could remain here? 6 month? 1 year? year and half?
how lower could it go? $30 pb? $25 pb? $20 pb? less? ok , now please tell me, do us, japan, and europe want to recover the crisis making cars and building houses? do they want to recover the employment? in order to revive the economy they must put money in it, then the people can get emoloyment and buy cars and houses, it means opened factories and banks, it means money in hand, AND IT MEANS OIL DEMAND, this is the true reality, the world wants to go on and on, so no matter how long it takes, we will see oil at $147 0r $200 or maybe more, who knows !

best regards

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