Relief at Oil Prices

Henton also stated that the oil demand predictions for the coming year,

is attributed to various reasons, such as a higher oil demand that is

expected from China, as domestic prices will encourage the importers to

increase their supplies. On the whole, Standard Chartered predicts that the

average spot price, from Dubai, for 2007 is expected to be $52 per barrel,

which is a substantial price drop from last years price, which was $61 per

barrel. A further lower in prices is predicted for the second quarter of

the year, which is expected to be approximately $50 a barrel, and then a

slight increase, in the fourth quarter, to approximately $53 per barrel.

An outstrip is expected, in the growth of the oil demand, from the oil

suppliers which are non-Opec members. Opec, which is the Organisation of the

Petroleum Exporting Countries. The non-Opec members include the countries

of Brazil, Russia and Azerbaijan.

Opec is the largest oil supplier, which supplies almost half the world

with oil, and is an organization of twelve oil producing nations. After

last year, when Opec met to cut supply due to the oil price falling below

$60 a barrel, Henton said that it can be expected that Opec will try to

prevent that oil prices decrease below $55 a barrel. Last year, Brent was

trading at an average of between $57 to $78 a barrel. On the opening of the

market in New York, yesterday, the price of the delivery destined for

February, saw that Brent at London’s ICE Futures exchange, closed at $60.44

per barrel, after falling 42 cents. The predictions made by Standard

Chartered, expects to see a more long term price, or even a medium price

range, of approximately $45 per barrel.