MercoPress. South Atlantic News Agency

Oil market has gone “crazy” says OPEC secretary

OPEC Secretary-General Abdullah El-Badri maintained on Thursday that the oil market has gone “crazy” and blamed the situation on geopolitical tensions, speculation and the weak US dollar. “We want moderate prices”.

"The price was 130 US dollars a barrel and today it has soared to 135 in a market gone totally crazy", said the OPEC Secretary General in Quito during a press conference. "The US economy is in recession and the dollar is rapidly depreciating which impacts on the price of oil", said El-Badri. However as has been OPEC's (Organization of Petroleum Exporting Countries) official stance, El-Badri pledged that the organization would act to boost supply if it were to see any shortages in the market. "Even if we increase output tomorrow, the prices will not come down because of speculation and because of a weak dollar", said El-Badri who this week visited OPEC members Venezuela and Ecuador. "When we see there is a shortage of supply, we will act" he added. World oil prices hit a record for the third day running on Thursday, topping 135 US dollars a barrel, as investors reacted to long-term supply constraints and a big drop in US crude stocks. El-Badri insisted that the crude oil market remains well supplied with OECD stocks increasing above their five year average but admitted concern about the volatility that has characterized the market in recent times. While assuring that OPEC will continue to strive to bring stability to the oil market, he also called on other stakeholders in the industry -consumers, producers, investors- to cooperate to find a lasting solution to the volatility. When asked about OPEC's basic currency Badri said it would take a long time for exports to switch away from the US dollar for pricing, as anti-US OPEC members Iran and Venezuela have urged. Ecuador, which rejoined OPEC late last year, has said the group should consider raising output to help lower prices because energy costs are spurring inflation worldwide and particularly hurting poor nations such as itself. Ecuador has also proposed creating a fund from windfall oil revenue to help poor nations.