Oil markets are rising due to speculation and the US dollar's fall, not to a lack of petroleum production, Opec President Chakib Khelil said on Sunday, the official Algerian news agency APS reported.
APS quoted Khelil, who is also Algerian Energy and Mines minister, as saying: "Prices are not going up because of a lack of output, but rather from the effect of speculation."
This increase in price "is linked not to a lack of production but to the devaluation of the dollar which has given speculators the opportunity to invest in oil."
The Organization of the Petroleum Exporting Countries (Opec) left its output steady at a meeting earlier this month despite calls from consuming countries for more oil to halt the record rally. The price hit a peak of $111 a barrel on Thursday.
Crude futures have jumped about 15 percent this year in part due to a steep decline in the US dollar, which has helped push up the nominal value of all commodities prices in the currency.
Khelil said investors were shifting into oil and gold because "there is no longer the possibility of good profitability in stock markets which have lost a lot of their value."
APS reported Khelil as saying Opec had played no role in oil's rise, adding that its move to keep levels unchanged had been approved "taking into account the situation of the market, which is well supplied with stocks of crude, which are more than sufficient in relation to the average of the past five years."
"How can some people say that Opec contributes to the current price spike and at the same time issue forecasts saying that world oil demand will reduce in the second quarter because of the economic crisis?" he added. (Reuters)
Oil prices rising due to speculation: Opec