An official Iraqi newspaper said Monday that the price of oil should be more than $50 a barrel, based on 1974 prices and an annual inflation rate of two percent."The price of a barrel of oil today should not be the same as it was in 1974," Al-Qadissiya said.
"Prices from 1974 must be increased by 18 dollars which would take the barrel price to more than $50," it said. "At $50 the real value of a barrel of oil in 2000 will be equal to that in 1974."
The paper based its estimate on a two percent inflation rate, over a period of 25 years, on the price of oil after the 1973 oil shock, $36.
"From an economic point of view, today's price of $36 a barrel does not respond to the interests of OPEC countries." The paper added that the price of crude should not be fixed in dollars "because that harms the interests of producers," and instead suggested using a basket of currencies, headed by the euro.
It also denounced the US policy towards OPEC through its "Saudi and Kuwaiti stooges who have made oil lose its real value."
Iraq, which has the second largest oil reserves in the world after Saudi Arabia, is opposed to OPEC's September 10 decision to hike output to cool spiralling oil prices.—AFP.
©--Agence France Presse.
© 2000 Mena Report (www.menareport.com )