Crude oil prices are set to continue falling towards OPEC's target of 25 dollars a barrel, since there is more than enough crude oil on world markets, OPEC's research director said Tuesday.
"I think prices will go down somewhere between 25 and 30 dollars, but we cannot speculate," Shokri Ghanem told journalists ahead of the Organization of Petroleum Exporting Countries (OPEC)'s summit in Caracas. "There is more crude than needed on the market," he added.
OPEC, which has already boosted its production three times in 12 months in a bid to bring prices down, is under strong pressure from oil-consuming contries to agree a further output increase.
While the presidents and sovereigns of OPEC were not expected to discuss production during the Caracas summit, the cartel's oil ministers are to meet in Vienna on November 12 to decide whether another hike is necessary.
"We expect markets to regularize," said Venezuelan deputy foreign minister Jorge Valero, who is responsible for organizing the summit.Echoing the assessment of several OPEC officials, he blamed high oil prices on market distortions caused by speculation.
Ghanem meanwhile played down the significance of last week's decision by Washington to release crude from the United States' Strategic Petroleum Reserve (SPR).
Crude prices, which have soared to 10-year highs above 35 dollars in recent weeks, have dipped since the US announcement.
"We don't think the effect is going to be more than just psychological in the short term," said the OPEC official, ahead of the formal opening of the OPEC summit on Wednesday.
Libyan Oil Minister, Abdallah Salem el-Badri, on the other hand, told journalists the timing for the release of the SPR was wrong. "I hope it will not affect prices too much and force us to cut production," he said.
Valero played down tensions between OPEC member states that emerged after Iraq accused Kuwait last week of stealing 300,000 barrels a day along the common border.
"There is no international circumstance in the Middle East that could generate tensions, there is an atmosphere of dialogue," he said at a news conference.--AFP.
(C)--Agence France Presse.
© 2000 Mena Report (www.menareport.com)