A leading South Korean economic think-tank has observed that the world’s crude oil prices might surge to break through the psychologically important $100 per barrel mark in three years.
The LG Economic Research Institute (LGERI) made the prediction on the basis that the development of fresh oil fields dipped substantially of late due to the global financial crisis.
The LGERI is an economic research arm of the LG Group, one of the country’s major business conglomerates The global investment in digging new oil lands has increased by an average of 21 percent from 2003 to 2007. However, the trend was reversed last year because of the economic turmoil, Lee Gwang-wu, a senior researcher at the LGERI maintained.
He noted that major investment banks slashed their ventures on new petroleum fields by 10 to 20 percent in 2008 that may lead to generate a long-term shortage of oil supply.
The effect of reduced investment will emerge in 2012. At that time, non-OPEC countries will not be able to offer enough oil to the world, Lee said adding that OPEC is expected to make a decision of strategically controlling the oil production, thus making its presence felt.
