Current levels of oil prices in the range of 70-80 dollars per a barrel are ”acceptable and reasonable” for both producers and consumers, H.E. Mohammed bin Dhaen Al Hamili, Minister of Energy, said today.
”The current levels of oil prices will enable OPEC member states to secure investment for boosting crude oil output capacities in the years to come to catch up with pace of economic growth, the UAE minister told WAM today a head of the OPEC meeting in Vienna on Wednesday to review the situation in the world oil market.
The minister, who will head the UAE delegation to the 156th OPEC ministerial meeting, said it is not natural to predict the resolution the OPEC meeting will make on production ceiling in the coming period, however, current data in the oil market do not invite a change in the targeted output level by the group in the next period.
He indicated that OPEC has revised up its projection for growth in the world oil demand for 2010 from 810,000 bpd to 880,000 bpd based on indicators showing recovery of global economy.
Al Hamili assured the market that OPEC would continue to provide enough crude oil supplies in case the demand goes up. OPEC has additional output capacity to meet that demand. He believed that the world oil market might see a decline in world demand in the second half of the year for seasonal factors at a time when global oil inventories were rising over standard rates seen in the past five years, putting a pressure on prices.
The UAE energy minister also noted that the relatively improvement in oil prices ”has nothing to do with supply and demand fundamentals” and primarily attributed to the dollar exhange rate against other international currencies and indicators of economic growth.
Highlighting the importance of producer-consumer dialogue for entrenching stability in the oil market, the UAE minister said joint meeting in Cancun, Mexico, later this month will have special significance as it comes at a time when the global economy is still reeling under the influence of the international financial crisis.
