Fuel prices to remain high: BP

Port-Of-Spain, Trinidad

Recent global fuel prices will remain high due to increasing consumer demand and instability in oil producing countries, a top oil company executive said.

Consumers will require 90 million barrels per day and 350 billion cubic feet (10 cubic meters) of natural gas by 2015, a third more than present consumption, said Lord John Browne, chief executive of BP PLC.

Growing demand in China, Russia, India and Brazil, coupled with instability and uncertainty about the future in the Middle East, are behind world oil prices hitting their highest levels in the U.S. since 1990, Browne said late Thursday.

"Those are the factors that are shaping the short-term market and there is no immediate sign that any of them will change dramatically," he said, speaking at a business conference in Trinidad's capital. "I think we have to expect continued volatility."

Oil prices on the New York futures market hit a record high of US$41.50 per barrel on Wednesday, then retreated slightly but still topped $40 per barrel.

Trinidad and Tobago is the largest oil and gas producer in the Caribbean. The state-owned oil company, Petrotrin, refines about 150,000 barrels of oil per day, exporting to other Caribbean nations and the U.S.

Its liquefied natural gas plant, Atlantic LNG, supplied the U.S. with more than 75 percent of its LNG imports last year. Trinidad and Jamaica are currently negotiating pricing arrangements that would lead to LNG being exported there.

London-based BP is Trinidad's largest energy producer at 400,000 barrels of oil and gas per day. It is also the largest investor in Atlantic LNG.

Browne said his company plans to raise production in and around the islands from 400,000 barrels of gas per day to 550,000 barrels by 2008.

"We intend to invest some $2.5 billion over the next three years in addition to the $9 billion we have invested here over the last two decades," he said.