I don’t think that with a 40-dollar price, or $45 a barrel, as we see it now, we can invest in any additional capacity,” Badri told a seminar organized by the Organization of Petroleum Exporting Countries in Vienna today. The decline in prices has already forced OPEC nations to delay 35 of 150 projects meant to increase global oil supply capacity, he said.
The seminar gathers ministers of the 12-nation group, industry executives including Royal Dutch Shell Plc’s Chief Executive Officer Jeroen van der Veer and representatives of other energy organizations like Nobuo Tanaka, the executive editor of the International Energy Agency.
Tanaka told the seminar that 64 million barrels a day in additional global crude oil production capacity are needed between 2007 and 2030 to meet growing demand for fuels. That represents eight times the current output of Saudi Arabia, the world’s largest oil exporter.
New York crude is trading about 70 percent lower than its July record of $147.27 a barrel. It was at $48.31 at 11:10 a.m. London time.
Last year’s record prices were not an indication of a shortage of oil, the market was well supplied and the stocks were high; it was caused by speculative investments flowing in and out of the oil market,” said Badri. Today the prices are moving to the other extreme, seriously threatening the long-term stability of the oil market.”