Abdulla al-Badri, the Secretary General of OPEC, warned that reduction in or halting of Iran oil exports could lead to unpredictable consequences on the world oil market. If Iran is attacked, the price of a barrel of oil shall increase uncontrollably, Mr Badri warned. Iran is currently the second-biggest oil producer behind Saudi Arabia, producing 4 million barrels daily. OPEC shall not be able to make up for the loss of Iranian crude on the international market, the International Herald-Tribune wrote, quoting the OPEC secretary general.
Mr al-Badri, therefore, urged a peaceful solution of the problem of Iranian nuclear programme, which is believed by some Western countries to have a military purpose, an accusation strenuously denied by Iran, which says that it is engaged in nuclear technology development for peaceful purposes only. Until now, this quarrel between states has not been blamed for constant price fluctuation on the global oil market; the weak US dollar is credited with that dubious leading role.
This explanation is disputed by Boris Rubtsov, head of the faculty of securities and financial engineering at the Financial Academy, who believes that the role of the dollar has been blown out of proportion. “To my mind, the major reason is a reduction in exploratory prospecting for crude oil deposits as well as a huge increase in consumption by the booming economies of India and China. The weakening of the dollar is also a contributing factor, but, not the leading one”.
It is now established that there is a close link between the price fluctuation of crude oil and geopolitics; at any rate, it is widely believed that Thursday’s price hike in crude oil in America and Britain was caused by Iran’s test firing of a series of rockets. The firing led to an almost 6 dollar (139.58 roubles. 3.76 euros. 3.02 UK pounds) increase in the price of a barrel of crude oil, now selling at more than 141 dollars (3,280 roubles. 88.46 euros. 70.89 UK pounds) per barrel, a serious signal to politicians.
11 July 2008
Voice of Russia World Service
http://www.ruvr.ru/main.php?lng=eng&q=29565&cid=57&p=11.07.2008 (in English)
