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Opec to seek assurances on oil demand

Opec will this week seek assurances from some of the world's biggest oil consumers that they will maintain their demand as the members of the oil cartel come under intense pressure to boost investment in production capacity.

The call, to be made at a summit of the Organisation of the Petroleum Exporting Countries in Riyadh this weekend, could boost long-term prices as investors worry the oil cartel will not invest enough to meet consumption in the face of growing demand from the likes of China and India.

The summit - only the third in Opec's 47-year history - comes as oil prices race towards a record $100 a barrel and with Opec crude oil revenues set to rise to $658bn this year, an increase of almost 9 per cent from 2006, according to the latest US government figures. The summit is expected to issue a declaration that will highlight the "relationship between security of supply and security of demand", according to Opec sources.

Consumer countries, in particular the US and in Europe, are investing in alternative sources of energy, such as biofuels and nuclear power, and energy-saving measures to reduce their dependency on crude oil and combat global warming.

Some Opec countries are worried such moves could jeopardise future demand just as they embark on expansion plans.

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Sun Nov 11th, 2007 at 06:40:08 PM EST
They have absolutely no reason to worry. They just have to count how many people live in China and India.

At least that's what Fatih Birrol of IEA said, but then IEA is OECD---> energy importers---> want low energy prices.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Sun Nov 11th, 2007 at 11:19:55 PM EST
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