OPEC says oil prices will gradually increase

JAKARTA (JP): A gradual tightening of the oil market will cause the oil price of the Organization of Petroleum Exporting Countries (OPEC) to increase by 3.5 percent per annum from 2001 onwards to reach US$23 a barrel in 2010, an official said.

OPEC Secretary-General Rilwanu Lukman said in his written address at a luncheon meeting here yesterday OPEC's oil price will probably continue increasing to $32 a barrel by 2020.

Oil prices on the world market are currently hovering at about $16 per barrel.

"World oil demand growth could be expected to average 1.6 percent up to the year of 2000 and then about 0.9 percent during the remaining 20 years," said Lukman, whose speech was read out by former OPEC secretary-general Subroto.

Lukman predicted that the world oil demand will register at 72 million barrels per day (bpd) by the year 2000, 80 million bpd by 2010 and 86 million bpd.

He said that OPEC's present production ceiling of 24.52 million bpd, which has come into effect since the final quarter of 1993, will be maintained until the end of this year.

OPEC agreed in Bali last November to freeze its ceiling at 24.52 million bpd through the end of 1995 to prop up prices.

Lukman estimated that OPEC's supply, including crude oil and liquefied natural gas, will be equivalent to over 30 million bpd of oil by the year of 2000.

He expected that OPEC's output will account for more than 50 percent of the world market within a decade and a half. The portion will be similar to its position in the middle of the 1970s.

OPEC currently shares 38 percent of the world's total oil output, while the remaining 62 percent comes from other countries.(04)