Khelil: OPEC spare reserves to calm market in 2006
HoustonChronicle.com - Khelil: OPEC spare reserves to calm market in 2006
Reuters News Service
ALGIERS - OPEC will have enough spare capacity in 2006 to calm oil prices, though they will stay above $50 a barrel for the next six months, Algerian Energy and Mines Minister Chakib Khelil said today.
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"OPEC spare reserves will be higher in 2006. This will contribute to calming the market," Khelil told a news conference.
The International Energy Agency (IEA) said on Tuesday that investment by OPEC (Organisation of the Petroleum Exporting Countries) could boost the cartel's sustainable production capacity by 500,000 bpd by the end of the year and further in 2006.
Next year should see more sweet, low sulphur crude that refiners crave coming online, the agency said in a report.
The IEA estimated non-OPEC oil output at 51.2 million bpd in 2006, down 300,000 bpd from its previous estimate, but up from an estimated 50.2 million bpd this year.
Khelil said possible lower economic growth would also help reduce oil prices, though they will remain high in the coming two quarters.
"Oil prices are driven by a strong U.S. economy. Prices won't go under $50 in the next six months," he said.
"History shows that after a period of high prices, another period of lower prices should come," he said, adding that there was a risk of "... a slowdown or stagnation of the international economy..."
Reuters News Service
ALGIERS - OPEC will have enough spare capacity in 2006 to calm oil prices, though they will stay above $50 a barrel for the next six months, Algerian Energy and Mines Minister Chakib Khelil said today.
ADVERTISEMENT
"OPEC spare reserves will be higher in 2006. This will contribute to calming the market," Khelil told a news conference.
The International Energy Agency (IEA) said on Tuesday that investment by OPEC (Organisation of the Petroleum Exporting Countries) could boost the cartel's sustainable production capacity by 500,000 bpd by the end of the year and further in 2006.
Next year should see more sweet, low sulphur crude that refiners crave coming online, the agency said in a report.
The IEA estimated non-OPEC oil output at 51.2 million bpd in 2006, down 300,000 bpd from its previous estimate, but up from an estimated 50.2 million bpd this year.
Khelil said possible lower economic growth would also help reduce oil prices, though they will remain high in the coming two quarters.
"Oil prices are driven by a strong U.S. economy. Prices won't go under $50 in the next six months," he said.
"History shows that after a period of high prices, another period of lower prices should come," he said, adding that there was a risk of "... a slowdown or stagnation of the international economy..."
posted by Marcel at 4:20 AM
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