Kuala Lumpur: Crude oil prices, which are hovering at above US$100 (RM300) per barrel, should be between US$75 and US$80 (RM225 and RM240) a barrel in line with actual market conditions and fundamentals, a top industry executive said.
Read more: Petronas: Crude should be trading at US$75-US$80 http://www.btimes.com.my/articles/OILAP/Article/#ixzz1PQN6U2JR
Petroliam Nasional Bhd (Petronas) president and chief executive officer Datuk Shamsul Azhar Abbas said oil prices have risen by more than US$25 (RM75) per barrel within a few months due to concerns of a supply disruption in the Middle East, North Africa as well as a weakening US dollar. "Prices play a pivotal role in resource allocation decisions of both consumers and producers but are influenced by the actions of central bankers and financial speculators. "How have we reached these price levels this early in the economic cycle given the absence of any real evidence of shortages in the market?," Shamsul asked in his keynote address at the 16th Asia oil and gas conference here yesterday. On another note, he said global capital expenditure in the upstream sector is expected to rise, reaching a record high of US$410 billion (RM1.23 trillion) this year from US$380 billion (RM1.14 trillion) last year. Shamsul said the Organisation of the Petroleum Exporting Countries' spare capacity has fallen below four million barrels a day while inventory levels of crude palm oil and petroleum products have come off their highs. Global natural gas rebounded strongly by 4.9 per cent and liquefied natural gas demand has increased 21 per cent. The buffers in supply that exist today might absorb this demand rise quite comfortably. On Asia's future oil demand, Shamsul said the region is expected to consume more than 250 billion barrels of oil by 2030, more than sixfold than its current proved reserves of about 40 billion barrels. "Asia's oil demand is projected to increase by two-thirds within the next 20 years. This will amount to more than 60 per cent of the gross increase in global demand over this period." Shamsul said geology-based assessments suggest that Asia's undiscovered oil resources at around 50 billion barrels. The majority of these resources are likely to be located in small-and medium-sized fields, which collectively amount to a significant potential. "At a recovery factor of 30 per cent, these undiscovered resources would translate into a resource base, one-and-a-half times the combined proved reserves of Indonesia, Vietnam and Malaysia," he noted.
Read more: Petronas: Crude should be trading at US$75-US$80 http://www.btimes.com.my/articles/OILAP/Article/#ixzz1PQN6U2JR
Petroliam Nasional Bhd (Petronas) president and chief executive officer Datuk Shamsul Azhar Abbas said oil prices have risen by more than US$25 (RM75) per barrel within a few months due to concerns of a supply disruption in the Middle East, North Africa as well as a weakening US dollar. "Prices play a pivotal role in resource allocation decisions of both consumers and producers but are influenced by the actions of central bankers and financial speculators. "How have we reached these price levels this early in the economic cycle given the absence of any real evidence of shortages in the market?," Shamsul asked in his keynote address at the 16th Asia oil and gas conference here yesterday. On another note, he said global capital expenditure in the upstream sector is expected to rise, reaching a record high of US$410 billion (RM1.23 trillion) this year from US$380 billion (RM1.14 trillion) last year. Shamsul said the Organisation of the Petroleum Exporting Countries' spare capacity has fallen below four million barrels a day while inventory levels of crude palm oil and petroleum products have come off their highs. Global natural gas rebounded strongly by 4.9 per cent and liquefied natural gas demand has increased 21 per cent. The buffers in supply that exist today might absorb this demand rise quite comfortably. On Asia's future oil demand, Shamsul said the region is expected to consume more than 250 billion barrels of oil by 2030, more than sixfold than its current proved reserves of about 40 billion barrels. "Asia's oil demand is projected to increase by two-thirds within the next 20 years. This will amount to more than 60 per cent of the gross increase in global demand over this period." Shamsul said geology-based assessments suggest that Asia's undiscovered oil resources at around 50 billion barrels. The majority of these resources are likely to be located in small-and medium-sized fields, which collectively amount to a significant potential. "At a recovery factor of 30 per cent, these undiscovered resources would translate into a resource base, one-and-a-half times the combined proved reserves of Indonesia, Vietnam and Malaysia," he noted.
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