OPEC sees oil below $40 by 2005: Report
Tuesday, October 5 2004 - 12:06 PM WIB
"The demand in the first quarter is still strong, however, I expect oil prices will come down if we eliminate non-fundamental factors, such as the situation in the Middle East, especially in Iraq," OPEC President Purnomo Yusgiantoro told Reuters on the resort island of Bali.
He said crude prices could drop if security issues in Iraq improve.
"I expect prices to come down below $40," said Purnomo, who is also Indonesian oil minister. He did not specify which benchmark price he was referring to.
Oil prices have hit record highs this year as the fastest growth in oil demand in 24 years has left the global supply chain stretched almost to its limits.
U.S. light crude for November delivery jumped to $50.40 a barrel Tuesday, just shy of the all-time peak at $50.47 hit Sept. 28 when rebels in Nigeria threatened to close output in the oil-producing Niger delta in their battle for autonomy with the government.
OPEC's reference basket of seven crude grades stood at $43.28 a barrel Monday, not far off this year's high of $43.54.
Purnomo was in Bali for the start of a three-day conference to discuss transparency of oil supply and demand data under the Joint Oil Data Initiative (JODI).
Launched in 2001, JODI involves roughly 90 countries committed to improving the reliability and transparency of data on global oil output, consumption and stocks. JODI began publishing data for its members in May this year.
Indonesia's crude oil output rose slightly to 966,465 barrels per day (BPD) in September from 965,000 BPD in August, a government official was quoted by Dow Jones as saying on Tuesday in Jakarta.
Indonesia remained unable to meet its OPEC quota of 1.3 million BPD because of dwindling reserves after years of exploitation and little new exploration.
The official said Indonesia produced 118,445 BPD of condensate in September, down slightly from 127,000 BPD a month earlier. (*)