OPEC weekly oil price keeps rising

21:05, January 17, 2011      

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The weekly average prices of the Organization of Petroleum Exporting Countries (OPEC) continued to increase by 2.34 U.S. dollars last week after it got above 90 dollars, reaching 93.30 dollars per barrel, the Vienna-based cartel said Monday.

OPEC weekly oil prices kept increasing for seven consecutive weeks. During last five trading days, OPEC oil prices increased with a largest range over the passing six weeks.

An increase in international oil prices last week was significantly caused by the close up of an oil pipeline in Alaska due to leakage. The oil pipeline was once reopened afterwards and the oil supply on the market has been improved.

However, it was shut off again on weekend. It is reported that the repair work will last for a week.

Approximately 12 percent of U.S. crude oil production was offered by this oil pipeline and its shutdown increased the U.S. concerns on sufficient oil supply, causing an increase in oil prices.

In addition, the U.S. crude oil inventories last week fell more than expected also supported the rising oil prices to some extent.

In the term of the relationship of supply and demand, the two big consulting institutions - the U.S."Standard & Poor's" and the German "Moody" both issued a report on last Thursday, expecting a favorable economic rating of Germany and France.

On the same day, EU Council President Van Rompuy also said that the EU had good economic growth last year, and expected the growth prospects for the next two years.

On the other hand, the international rating agency "Fitch" released a report on Saturday, which downgraded Greece to a rank order of "junk" and set its rating outlook as "negative."

It is the third large rating agency to rate Greece as "junk." It also shows that the Europe debit crisis, which would affect the oil prices greatly, would be unable to be solved for the short term.

Meanwhile, the two major U.S. rating agencies also have no optimistic prospective on the U.S. rating situation.

Regarding the rising international oil prices recently, many OPEC member countries believe that the current oil price would not threaten world economic growth.

Iranian Oil Minister Massoud Mirkazemi said "the price of 100 dollars (per barrel) is not too much," so believed the Venezuelan Oil Minister Rafael Ramirez too. The member countries of Libya and Ecuador also expressed similar views.

However, one of Saudi Arabia representative in OPEC said, 70-80 U.S. dollars per barrel is the moderate oil price for both producers and consumers. "If oil price continue to rise over 100 U.S. dollars, the OPEC emergency meeting should be held (to discuss countermeasures)."

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