OPEC President, Shakib Khalil, Sees No Easing of Oil Prices, EU-OPEC Say Secure Oil Demand Key to Spurring Oil Investment

OPEC president sees no easing of oil prices

www.chinaview.cn 2008-06-24 23:15:52  

    BRUSSELS, June 24 (Xinhua) --

World oil prices will not come down and oil producers have done what they could to ensure supply, the Organization of Petroleum Exporting Countries (OPEC) president said Tuesday.

    "OPEC has already done what OPEC can do and prices will not come down," OPEC president, Shakib Khalil (Chakib Khelil in French spelling) told reporters as he arrived for a high-level dialogue with European Union (EU) officials in Brussels.

    As the world oil prices reach 140 U.S. dollars per barrel, a once unimaginable record level, producing countries have been under rising pressure from consuming countries, including the EU, to increase production.

    Slovenia, which currently holds the EU's rotating presidency, said prior to the dialogue that the 27-nation bloc would particularly highlight its concerns about high oil prices.

    Before hosting a summit between producers and consumers in Jeddah last weekend, Saudi Arabia, a leading member of OPEC and the world's top oil exporter, promised last Thursday to increase oil output by 200,000 barrels per day.

    "Other member countries don't want to increase their production because, as they've said many times, from our perspective we don't see any shortage in the market," OPEC Secretary General Abdullah al-Badri said.

    While emphasizing market fundamentals like "supply and demand," western heavy oil-dependent consumers have been urging OPEC members to raise production, the latter however believe causes of the price hike are actually "speculation and a weak dollar," insisting there is enough supply at the pumps.

    "The market is currently hijacked by speculators," al-Badri said, "There is no shortage of supply as I said before."

    Light, sweet crude for August delivery rose by 1.30 U.S. dollars to138.04 dollars a barrel by the afternoon in European electronic trading on the New York Mercantile Exchange on Monday. Brent crude futures rose 1.19 to 137.10 dollars a barrel on the ICE Futures exchange in London.

EU, OPEC diverge on responses to soaring oil prices

www.chinaview.cn 2008-06-25 03:50:14  

    BRUSSELS, June 24 (Xinhua) --

The European Union (EU) and the Organization of the Petroleum Exporting Countries (OPEC) found little in common on responses to the soaring oil prices at a meeting on Tuesday.

    While the EU updated its call for the world's major oil producing countries to raise output, OPEC leaders were actually saying there is enough supply in the market, blaming a weak U.S. dollar, the U.S. sub-prime crisis and speculative activities for the current price shock.

    EU Commissioner for Energy Andris Piebalgs said earlier Tuesday that OPEC should remove its production ceiling in order to provide relief for the market.

    "In my opinion, there is no reason to keep ceilings on production," he said ahead of the EU-OPEC Energy Dialogue, which brought together key policy makers from both sides, just two days after a global summit on oil prices in Saudi Arabia's Red Sea city of Jeddah.

    "If there are no ceilings, markets will adapt much faster," Piebalgs said, "In this respect we could expect prices to go down, not to go up as the tendency has been till now."

    However, OPEC president Chakib Khelil insisted the cartel has already done what it can do to supply the market, but prices will not come down due to other reasons.

    "All you need to do is look at the data to be convinced that the market is well-supplied in oil, that we have enough surplus capacity and we have enough stocks in the market," he told reporters at a joint press conference with EU officials after the one-day dialogue.

    Khelil accused the U.S. sub-prime crisis, which broke out last summer, the decline in the U.S. dollar and speculation on the financial markets of being responsible for the record high prices.

    Khelil estimated the subprime crisis and the ensuing impact of the dollar devaluation and the influx of funds into oil markets contributed to a 40 U.S. dollars' hike in the price of oil.

    Asked about the short-term perspective of the oil prices, Khelil said the move would largely depend on the evolution of the U.S. dollar and the geopolitical situation, which were out of OPEC's control.

    "The market is waiting to see how the dollar is to evolve in July, how the geopolitical situation is going to evolve with the threats made to Iran," he said.

    "So if you can answer those questions, I can answer the question concerning the price," he added.

    However, Piebalgs said he was "not convinced" that speculation on financial markets was "a major factor" behind high oil prices.

    "The basic difference between us and OPEC is that they believe that it is mostly speculation and in my opinion it is that market fundamentals that are not responding any more and that's why the prices are going up," he said. 

Editor: Mu Xuequan

EU, OPEC say secure oil demand key to spurring oil investment

www.chinaview.cn 2008-06-25 03:46:23  

    BRUSSELS, June 24 (Xinhua) --

The European Union (EU) and the Organization of the Petroleum Exporting Countries (OPEC) agreed on Tuesday that secure future demand is key to spurring oil investment to guarantee supply.

    The EU and OPEC "recognized the importance of secure future demand for crude and products in spurring timely investment both upstream and downstream, thus contributing to greater security of supply," said energy officials from both sides in a joint statement after a meeting here.

    The fifth EU Energy Dialogue, attended by EU Commissioner for Energy Andris Piebalgs and OPEC President Chakib Kheli and Secretary General Abdullah al-Badri, among others, took place in the aftermath of a global summit on oil prices in Saudi Arabia's Red Sea city of Jeddah Sunday.

    The summit, which brought together the world's major oil producers and consumers, ended with a call for more investment and improved transparency in the oil industry.

    During the dialogue, the EU confirmed its policy developments would not translate into a reduction in oil imports.

    "In 2030, according to our forecasts, the EU will be importing more oil than we are importing today, even taking into account that all our climate change policies will be in place," Piebalgs said after the meeting.

    The EU is currently promoting the use of renewable energy and biofuels in its ambitious plan to reduce oil dependence and diversify energy supply, which causes concern among oil producing countries about a dwindling demand.

    Despite the EU's assurance, OPEC leaders "stressed the uncertainties related to the demand for its crude, stemming mainly from technology, alternative fuels as well as consuming countries policies."

    But they welcomed the growing diversity in the energy mix, including renewables, saying the EU's move would help bring soaring prices down before demand gets destroyed.

    "We are concerned about the current high oil prices, because these basically destroy demand. All those will lower demand, but I think it's a good thing to lower the demand," Khelil said.

    "The EU is doing a very good job and it should continue in this way because OPEC member countries would benefit greatly from the experiences of the EU in terms of energy efficiency, conservation (and) carbon-dioxide abatement," he added.

    However, OPEC leaders rebuffed an updated call from the EU to raise oil production, saying the markets are currently well supplied.

    "OPEC representatives presented their analysis of the recent developments in the oil market, reiterating that it remains well supplied, with supply exceeding demand and with healthy commercial crude stocks," the joint statement said.

    Earlier today, Khelil told reporters that OPEC has done its utmost to ensure supply, but the world oil prices will not come down due to other factors, notably speculation.

    "OPEC has already done what OPEC can do and prices will not come down," Khelil said as he arrived for the meeting.

    As the world oil prices were attempting to hit 140 U.S. dollars per barrel, a once unimaginable record level, oil producing countries have been under rising pressure from consuming countries, including the EU, to increase production.

    Ahead of the Jeddah summit, Saudi Arabia, a leading member of OPEC and the world's top oil exporter, promised on Thursday to raise its oil output by 200,000 barrels per day.

    But al-Badri said today that other OPEC countries were unwilling to follow.

    "Other member countries do not want to increase their production because as they have said many times from our perspective we do not see any shortage in the market," he said.

    Oil producing countries instead blamed the price hike on the U.S. sub-prime crisis and a weak U.S. dollar, which diverted large amount of speculative investments to the commodity markets.

    "OPEC stressed the role of financial markets as well as the declining value of the dollar in driving the current crude oil price and volatility, in particular through increased speculative activity," the joint statement said. 

Editor: Mu Xuequan