The Hindu

• Situation in major oil producing nations is stable
• Global crude prices likely to peak around $80 a barrel

Mangalore, Sep 16: The current high-level global oil prices are unlikely to come down in the near future despite lack of supply concerns, Chairman and Managing Director of Oil and Natural Gas Corporation Limited R S Sharma has said. The international market is marked by constant crude oil prices due to multifarious reasons.

Although this is a lean season as far as demand for oil is concerned, the prices are still high, he noted.

Interacting with presspersons after the 19th annual general meeting of ONGC’s subsidiary Mangalore Refinery and Petrochemicals Limited here on Friday, the ONGC Chairman said that the major oil producing nations had all tapped into their oil reserves located at shallow depths - both on land and off shore.

While the demand for oil has gone up, we have not been able to match supplies due to lack of adequate newer sources of oil, he said.

New sources

This has meant that oil producing companies would have to look at newer sources of oil, especially on the high seas and the cost of production from such prospective sources was high.

It also required better and sophisticated technology to produce oil from such difficult locations and this in turn pushed up the cost involved, he noted.
“We have plucked all the low lying fruits and now have to reach out for the higher ones,” he said.

Analysing the situation further, Sharma said the situation in most major oil producing nations such as Nigeria and the West Asia was stable.

Prices

“While this should have vastly helped in reduction of global crude oil prices, we are seeing a situation where the prices are constantly moving northward,” Sharma added.

Stating that this was a cause for concern, Sharma said the global crude prices might peak around $80 a barrel.