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Tight supply and demand to keep oil prices high

Business Materials 9 August 2008 06:17 (UTC +04:00)

Global oil prices in the foreseeable future will broadly remain where they are today due to the market fundamentals of supply and demand, said Steve Peacock, BP's president for the Middle East and South Asia, GN reported.

"Continuing tightness in supply versus demand and tightness in spare capacity are the reasons for that assessment," Peacock told Gulf News.

International oil prices have fallen sharply from a lifetime high of $147.27 a barrel on July 11, as an economic downturn in the US, the world's biggest oil importer, has slowed consumer demand.

The world oil output of nearly 87 million barrels per day is just about keeping pace with current demand, with new demand being led by emerging economies - China and India.

"Oil prices wouldn't fall significantly from the current levels," said Peacock.

Separately, he said BP's budget for new petroleum investments in the UAE is being finalised. "We will continue to invest in Sharjah, where we are operating three gas fields and a liquefied petroleum gas plant," said Peacock.

He said BP will continue to invest in Abu Dhabi through the Adnoc group.

BP produces about four million bpd of oil and gas equivalent globally. From the Middle East, the company's share of production is close to 230,000 bpd.

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