The jump in crude prices is unlikely to provoke an inflationary spiral in oil-importing countries, an expert at the UN Conference on Trade and Development (UNCTAD) said Tuesday.
The expert, Jan Kregel, told reporters that he expected prices to decline within six-to-nine months -- from about 34 dollars a barrel today to between 22 and 28 dollars, the oil-exporters' preferred range.
Oil-exporting countries were "concerned" that prices had reached a level where "alternative supply sources become competitive," he said.He estimated that Saudi Arabia, Bahrain and the United Arab Emirates had excess capacity of at least 4.7 million barrels a day, and said this was sufficient to meet the recent increase in demand for oil.
Kregel is UNCTAD's high-level expert on international finance and one of the authors of the 2000 Trade and Development report, published in Geneva on Tuesday."The impact so far of rising oil prices on the developed countries -- aside from the street impact that we have recently seen in Europe -- has been relatively muted and does not appear to be causing concern in monetary authorities and central banks around the world," he said.
"It seems unlikely that this will produce some sort of inflationary spiral," he added.
"What we are likely to get is a once-over kick-up in prices as a result of what will probably be a nine-month period in which oil prices are above normal," he said.—AFP.
©--Agence France Presse.
© 2000 Mena Report (www.menareport.com)
