MercoPress. South Atlantic News Agency

OPEC anticipates higher oil prices during first quarter

OPEC president Chakib Khelil said on Saturday that the organization is supplying the international market with enough crude but can't be blamed for record prices. But he anticipated oil prices can be expected to keep rising during the first quarter of this year before stabilizing in the following quarter.

"The rise is likely to continue until the end of the first quarter 2008 and will stabilize in the second quarter" Khelil, who is also Algerian Energy and Mines Minister, told the Algerian official news agency APS. He linked the steady rise of oil prices to "political tension in Pakistan, escalating violence in Nigeria and a decline of oil inventories in the United States", APS added. Khelil said OPEC's next meeting on February first, in Vienna, would closely study forecasts for world economic growth, particularly those of the United States, which has been seriously affected by the subprime mortgage crisis. The world market had sufficient oil supplies for now and no decision could be made to increase production before the next OPEC conference, he insisted. Oil prices in New York rose above the record 100 US dollars benchmark this week as violence flared in Nigeria, Africa's largest producer, cold weather in the northern hemisphere boosted demand for fuels and investors bought commodities to hedge against inflation. But prices closed on Friday in the range of 97.91 US dollars a barrel. Separately, a Kuwaiti newspaper quoted the Qatari oil minister as saying OPEC was not behind the recent rise in oil prices as markets were well supplied and the price was purely driven by speculators. "Investment funds and speculators are behind the recent hike," Abdullah al-Attiyah told al-Jarida newspaper in comments published on Friday. "The market is not suffering from any lack in supplies, and there is no disturbance in producers' regions". OPEC which supplies more than a third of the world's oil led by the world's top oil exporter Saudi Arabia, left production targets unchanged at its December 5 meeting, ignoring U.S. and E.U. calls to pump more oil. OPEC's production ceiling now stands at 29.673 million bpd for 12 of its members. War-torn Iraq, which doesn't have a quota, produces about 2.3 million barrels a day. From Teheran an Iranian official said many OPEC states will not be able to raise their output even if it is decided to reduce the soaring prices. Many members of OPEC can not increase their production as they are unable to raise their refineries' capacity, said Deputy Director of the National Iranian Oil Company (NIOC) Mohammad-Ali Khatibi. When asked if OPEC would hold an emergency meeting to discuss an increase in oil output, Khatibi told Shana news agency that most OPEC members are currently producing at their full capacity. "First, we must make sure that the market's current problem is crude oil shortage, because in winters and summers a shortage of crude products may trigger a rise in prices," he added. He further predicted that oil prices would increase by 10 percent in 2008.