Oil prices are likely to rise further largely due to a weak dollar and geopolitics, Chakib Khelil, president of the Organization of the Petroleum Exporting Countries (OPEC), said Sunday.
"The price of oil will rise again in the coming weeks. We have to follow the evolution of the dollar, because a 1 percent fall in the dollar means four dollars more on the price of oil," Khelil said in an interview with the local daily Algeria-News.
The Algerian minister of energy and mines also highlighted the geopolitical impact on oil prices, noting the current crisis between Iran and the West over its nuclear program as well as the previous sanctions on Libya.
"The embargo imposed on Libya has prevented any increase of investment in that country, just as the current embargo on Iran is stopping anyone investing there," Khelil said.
"The United States is threatening severe economic sanctions against any group which dares invest in Iran. Similarly, the war in Iraq is why investment there is weak. No OPEC country can invest in embargoed countries," he said.
"I believe that 60 percent of the rise is due to the fall in the exchange rate of the dollar and to geopolitical problems, and 40 percent to the intrusion of bioethanol on the market," he said.
The minister denied accusations by some western countries that insufficient supply by the oil producing countries are causing the soaring prices.
"As producer countries we think that the current supply is sufficient, that this balance in supply is in everybody's interests and that it shouldn't be disturbed," he said.
"The current rise in oil prices is in nobody's interest," he added.
Khelil said last week that the Vienna-based cartel would increase its output to 52 percent of the global oil supply by 2010from the current 40 percent.
How to curb the soaring oil prices tops the agenda of the summit of the Group of Eight (G8) industrialized countries which will kick off in the northern Japanese resort of Toyako on Monday.
Crude oil futures hit a record high above 145 U.S. dollars a barrel in New York on Thursday.