Oil may fall to $US45-$US55: OPECFrom: ReutersBy Dmitry...

Oil may fall to $US45-$US55: OPEC
From: Reuters
By Dmitry Zhdannikov in Moscow

November 01, 2005


OPEC expected world oil prices to stabilise in a range of $US45-$US55 a barrel next year and had ample spare capacity to meet demand, acting Secretary-General Adnan Shihab-Eldin said overnight.
"Based on fundamentals, prices should not increase. They should moderate below the levels of recent months," Mr Shihab-Eldin said.

"I see the prices next year in the range of $US45-$US55," he said.

"There is room for them to stabilise in this range, certainly above $US40," he said.

Global benchmark oil prices are well down from record highs touched two months ago, with US light crude futures trading around $US60.60 overnight, compared with the high of $US70.85. December Brent futures were trading near $US58.70 a barrel.

"We saw no reason for prices to go that high. We saw some signs among developing countries that it was beginning to cause them problems and that's not what we want," he said.

Past oil price spikes have damaged industrial economies as rising fuel costs overtake economic growth.

This time developed economies had shown resilience, Mr Shihab-Eldin said. There had been some concern of US oil demand slackening, he said, until data out last week showed the U.S. economy grew strongly in the third quarter of 2005.

He said the market should be reassured about crude supplies, since OPEC has spare production capacity of 2 million barrels a day, more than enough to cover extra winter demand, and it was planning to bring more on stream next year.