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Oil prices to hit $100 per barrel in first quarter of 2011

Oil&Gas Materials 6 January 2011 20:14 (UTC +04:00)

Azerbaijan, Baku, Dec. 6 /Trend, A.Badalova/

Oil prices on world markets rose again on the backdrop of positive economic statistics and issuance of U.S. data on raw reserves, which have declined by 4.2 million barrels over the last week of 2010.  

As a result of the trades on Wednesday, Jan. 5, the February futures price for U.S. WTI oil on the New York Mercantile Exchange rose by $0.92 up to $90.3 per barrel. On the London Stock Exchange, the February futures price for the North Sea Brent rose by $0.97 up to $95.5 per barrel.

Analysts one of the largest U.S. banks JP Morgan believe that on the backdrop of positive economic environment, oil prices will continue to demonstrate a positive trend. According to U.S. analysts, oil price will reach $100 per barrel in the first quarter of 2011.

In their December report, analysts of the U.S. bank raised their forecast for the price of North Sea Brent to $95 per barrel, and also indicated the probability of a sharp price spike above $100 per barrel in the first quarter of 2011.

On analyst's forecasts are influenced by two factors: the difference in supply and demand and global economic growth, which accelerated by the end of 2010, and according to analysts' of JP Morgan, will continue in the first quarter of 2011.

World oil demand is expected to reach 88.8 million barrels per day in 2011 (which is higher than the rate observed before the recession), which is an average of 2.45 million bpd more than in 2010. In turn, the oil supply of OPEC non-member countries is expected to increase 1.2 million bpd next year.

According to analysts of the International Energy Agency, the oil price of $100 per barrel or more could become a threat to global economic recovery.

Earlier, Iraqi Oil Minister Abdul Karim al-Luaibi said that in case of a sharp rise in fuel prices, OPEC may convene an extra-ordinary meeting. The cartel considers fair price of oil $70 to $90 per barrel.

Today, oil production quotas set by OPEC is 24.84 million bpd.

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