Azerbaijan, Baku, Feb. 16 /Trend, A.Badalova/
Oil prices on world markets will increase because of the growth of political unrest in the Middle East, Western experts believe, however, their growth will be offset by the fall in world demand for hydrocarbons.
"As political unrest spreads to other areas in the Middle East, investor confidence will decline and oil prices will rise," climate change and energy policy analyst at Cascade Policy Institute, Todd Wynn, wrote in an e-mail to Trend.
Wynn said it is possible to see record oil prices such as seen in 2008.
"It is possible but demand is depressed due to world economic conditions which could offset some of the price increases due to instability in the region," he said.
This week on the backdrop of political unrest in Iran, concerns have increased about the suspension of oil supplies from the Middle East and record growth in oil prices in the light of events.
Demonstrations began Feb. 14 in Tehran and other cities across the country in support of the peoples of Egypt and Tunisia. Clashes occurred between protesters and police. The mass protests in the capital of Iran killed two people, several demonstrators were injured, more than 200 protesters were arrested. Earlier one of the largest anti-government protests over the past decade occurred in Egypt, as a result of which President Hosni Mubarak resigned, and the leadership of the country shifted to the Supreme Council of Armed Forces.
Today Iran is the fourth largest oil exporter in the world and the second in OPEC. According to data provided by BP, the proven oil reserves in the country as of the beginning of 2010 amounted to 137.6 billion barrels. Oil production in Iran in 2009 totaled 4.216 million barrels per day, demand - 1.741 million barrels per day.
According to analysts, strong growth in oil prices will be recorded if production is stopped anywhere in the Middle East region, as well as traffic through the Suez Canal.
The President of Pioneer Astronautics Company Robert Zubrin believes that oil prices may again rise to historic maximum, which was observed in July 2008 ($147 per barrel).
Zubrin told Trend earlier that if the unrest spreads to the Persian Gulf and major oil-producing countries such as Saudi Arabia, the impact on the prices of hydrocarbons will be huge and long.
Early this week, the UAE Oil Minister Mohammed Al-Hamli said that OPEC is ready to increase oil supplies if demand increases. Last month, the organization raised production to 29.72 million bpd, the highest level in the last two years.
According to forecasts of the U.S. Energy Information Administration (EIA), world oil demand will rise by 1.44 million bpd to 88.16 million bpd in 2011 and 1.63 million to 89.79 million bpd in 2012.
OPEC oil supplies are projected by EIA at the level of 29.85 million bpd in 2011 and 31.03 million bpd in 2012.
Following the auction on Tuesday, Feb. 15, April futures price for Brent fell by $1.44 per barrel up to $101.64 per barrel. The cost of the March futures for the U.S. WTI oil on the New York Mercantile Exchange fell by $0.19 up to $84.32 per barrel. The reason for drop in prices is the macroeconomic data from the U.S. and China.