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Sun 23 Mar 2008 10:20 AM

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Oil to stay over $80 for rest of '08

Crude prices will range between $80 and $110 a barrel for remainder of year, Opec president says.

Petroleum prices will range between $80 and $110 per barrel for the rest of 2008, Opec President Chakib Khelil said on Saturday.

Khelil, who is also Algerian energy and mines minister, told Algerian television Opec was under "big pressures" from consuming nations who liked to portray the group as responsible for high oil prices, when in fact the market was responding to US economic problems and the falling dollar.

"Prices will continue to be high, and the prices for the rest of the year will be between $80 and $110," he said.

Opec left its output steady at a meeting earlier this month despite calls from consuming countries for more oil to halt the record rally.

Oil and other commodities have struck a series of record highs since the beginning of the year as investors fled stock markets and took refuge in dollar-denominated assets.

But US oil prices have eased since hitting a record $111.80 a barrel on Monday as signs of an economic slowdown mount, raising the possibility of a slowdown in world demand for commodities.

Khelil has long said Opec has played no role in oil's rise in recent months.

"There are big pressures on Opec and some consuming nations would like to present Opec as being behind current high prices," Khelil said.

"But the truth is that the current prices are linked to the U.S. economic problems as well as to the value of the dollar."

He added Algeria's oil and gas sector would continue to do business in the US dollar.

"We will continue to work with the currency of the international market," he said, referring to the dollar. (Reuters)

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