7th APRIL 2015 - Vol.XXXVIII No.018
Business News

Oil prices set to remain at $100

DOHA: Oil prices are forecast to remain at around $100 a barrel in 2012 as global demand from developing economies grows, offsetting a slowdown in the crisis-hit euro zone, industry figures and reports said.

A fast comeback of Libyan oil production levels is also helping ease anxiety despite concern over the impact of a possible EU embargo on Iran oil over its nuclear programme, and uncertainties over uprisings sweeping many Middle Eastern countries.

At the 20th World Petroleum Congress which concluded yesterday in Doha, BP chief executive Robert Dudley said Asian economies were continuing to prop up demand. "We see demand holding up in Asia, so we're planning this year on $90 to $100 a barrel. It looks like it's a fairly solid floor for this year," he said.

His counterpart at the helm of US oil-giant ExxonMobil, Rex Tillerson expressed confidence in the long-term positive prospects for energy, particularly the role hydrocarbons will continue to play.

Opec chief Abdullah El Badri said it didn't set a target price. The current price was satisfactory for producers and consumers and excessive speculation was harming both, he added.

Opec is meeting next week in Vienna but members have revealed no intention of changing output levels, in part due to the fast return of Libyan output which Mr El Badri said would hit the pre-conflict level of 1.58 million barrels per day by mid 2012 - six months earlier than expected.

International Energy Agency chief Maria Van der Hoeven disagreed, warning that "crude prices remain alarmingly high," and a triple-digit oil price continues to be "a source of concern."

Anglo-Dutch oil giant Shell head Peter Voser highlighted the events contributing this year to maintaining a high price of oil that has "been rising on the fundamentals," including Japan's quake. "There are a lot of regulatory and political uncertainties, which are adding to price and cost volatility."

Deutsche Bank said it had raised its expected West Texas Intermediate average price to $105 for a barrel in 2012, and Brent at $115, forecasting a 3.4 per cent growth in the global economy in 2012 and this year's growth at 3.7pc.

click on image to view the digital edition