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Mon 29 Sep 2008 05:31 PM

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Oil prices to ease - IEA chief

Oil prices should ease in coming months but extreme weather, labour disputes could see bottlenecks.

Oil prices to ease - IEA chief
PRICE EASE: Oil prices should ease in coming months, the head of the international energy agency (IEA) has said. (Getty Images)

Oil prices should ease in coming months but extreme weather conditions and labour disputes in the industry could create new supply bottlenecks, the head of the international energy agency (IEA) said on Monday.

However, no dramatic bottlenecks were to be expected between now and 2010 because oil supply was relatively generous compared to demand, IEA Executive Director Nobuo Tanaka said at an event on renewable energy sources in Berlin.

But after 2010, and above all after 2013, the situation would become more difficult because there was no immediate prospect of new reserves coming on to the market and this would affect prices, he added.

"The era of low prices is over," he said.

Oil fell more than $3 a barrel on Monday to just over $100, pressured by gains in the US dollar as well as mounting evidence of damage to Europe's economies from the financial crisis.

Falls in demand in the United States and other developed economies have contributed to oil's drop from a record high of $147.27 a barrel in July. (Reuters)

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