Oil rises in price according to Chavez's plan

The Venezuelan leader's forecast of a barrel price of $100 may come true this year

Oil prices again set a record at the end of last week - at trading in New York on Thursday they crossed the psychological mark of $90 per barrel and settled at $90.07 per barrel. This was enough to frighten the George W. Bush administration. According to Reuters, White House spokesman Tony Fratto said: "Of course the president would like to see oil prices go down, but he would also like to see us rely less on foreign sources of oil and reduce our dependence on all sources of oil." However, the standard of “light” WTI oil did not stay at such a high level for long: on Friday, a barrel was already worth $88.6, at times reaching $88.29. Experts note that traders expect a shortage of petroleum products in the fourth quarter, and therefore futures Oil prices have become so expensive. Also among the reasons for the rise in price are the Iraqi-Turkish confrontation and the weakening dollar.

Oil prices began to grow at a fairly strong pace in October. Over the past two weeks, November futures for WTI rose by $10.45 per barrel (or 13.2%), for North American Brent - by $7.58 (or 9.9%), to 84.16 dollars per barrel. Spot prices also increased significantly: for WTI - by $9.29, to $88.55 per barrel, for Brent - by $5.96, to $84.44 per barrel, for Russian Urals - - by $6.31, to $80.79 per barrel. Traders’ concerns are based on several factors, says Mikhail Perfilov, development director of the oil agency Argus. First of all, military - there is a threat of Turkish troops entering Iraq, and the Iranian problem does not subside. In addition, BP reported a fire at the North field in Alaska, which risked losing several million barrels of crude. However, on Friday the company said that the fire did not have a serious impact on production. And finally, the most important thing: in November-December, traders expect tension in the oil products market in Europe (currently very low reserves, which is uncharacteristic for this period), and this may lead to an increase in prices for them and, along the chain, for oil . The situation in financial markets is also in favor of expensive oil. “The dollar continues to decline, which has led to an influx of oil investment as a hedge against a weak dollar,” Commonwealth Bank of Australia analyst David Moore told news agencies. However, on Friday investors were already taking profits from the rise in prices.

OPEC does not seem to intend to take immediate measures to reduce prices. Algerian Minister of Energy and Mines Shakib Khelil told news agencies that there would be no convening of an emergency meeting of the cartel: this is not necessary, he said, since the world oil market is now “well supplied with oil.” “Prices will continue to rise. The reason for this is geopolitical tension and the lack of new oil refining capacity in the global economy,” the minister said. At the upcoming meeting of energy ministers of OPEC member countries, which will be held on November 17 in Riyadh, issues of oil production volumes will not be discussed, Mr. Khelil clarified, while he said that consultations on production levels will be held at the next OPEC session, which will take place on December 5 in Abu Dhabi. The reason for the ineffectiveness of the cartel, according to the Algerian minister, is the forecast that with the end of winter in the Northern Hemisphere, oil prices will go down, as daily demand will decrease by 2 million barrels.

Thus, at the end of this year, oil has every chance, if not to go over, then at least to get close to the mark of $100 per barrel. Venezuelan President Hugo Chavez and Deutsche Bank experts warned back in 2004 that this would happen sooner or later. The bank's experts then released a forecast under the telling title "Face to Face with Horror." It reported that if any incident, disaster or sabotage led to a reduction in supplies, for example, from Iraq, then oil prices could reach just $100 per barrel. The Turkish-Iraqi conflict now only confirms this assumption.

Hugo Chavez has long been known for his prophecies regarding oil prices. In 2001, he said that oil would cost $50 a barrel, but no one believed it. In 2004 this became a reality. Then, while in London, he made a new forecast - $100 per barrel if the United States launched a military strike on Iran. “The English middle class will have to give up cars,” Mr. Chavez said then at a meeting with London Mayor Ken Livingstone. “If the Americans attack Iran, the Iranians will cut off oil supplies. We would do the same if we were attacked.” . Later, he repeatedly repeated his forecast, justifying it by the fact that “the world is entering an energy crisis” due to the “unlimited consumption society” model being formed by the United States.

However, already in the new year, experts predict some softening of the situation on the oil market. According to Mr. Perfilov, calculations by many institutions show that traders need to focus on a price in the range of $60 to $80 per barrel in the first quarter of 2008. As spring approaches, oil prices usually fall slightly due to lower consumption.

Nikolay GORELOV