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NIOC official: Crude prices to hit highest level in autumn

Tehran, Aug 20, IRNA-Crude prices will hit their highest level in autumn this year if the market variables continue to affect the prices in absence of any oversupply by the OPEC and non-OPEC members, said a senior Iranian official here on Saturday.

Deputy Head of National Iranian Oil Company (NIOC) for International Affairs Hojjatollah Ghanimifard told IRNA that statistics available show the oil market will witness 1,200,000 bpd to 1,500,000 bpd increase in the demand for oil in autumn compared to summer.

Ghanimifard said that oil prices witnessed high fluctuations on the markets in August this year, setting a new record in history of its trade.

Each barrel of light and sweet West Texas Intermediate (WTI) crude in the US and each barrel of North Sea Brent crude were sold for about dlrs 67 and dlrs 67.32 respectively on August 12.

The Iranian official said oil prices started to fall from middle of last week partly due to paper exchanges.

The official predicted that by middle of next month, special changes will be made in the signatories to the paper oil deals -- some will stabilize their condition or leave the position and deal they have signed.

Ghanimifard predicted that in about next two weeks summer holidays end and when the educational season begins, there will be highest ecord of gasoline consumption in the US, of gas oil consumption in northwestern part of Europe and of gasoline consumption in the Mediterranean states.

He said among reasons for increase in prices of oil in the second month of summer were hot weather in part of th US and some European states and a rise in use of cooling facilities.

Due to the same reasons, he said, the price for each ton of gasoline climbed to about dlrs 817 from about dlrs 705 in the US and to dlrs 635 from about dlrs 575 in the Persian Gulf states in two weeks.

Moreover, the price of each ton of kiln oil rose to dlrs 388 from dlrs 353 on the US market and to dlrs 284 from dlrs 252 on the Persian Gulf market in the said period, he said, adding that prices or other oil derivatives also were affected by rise in the gas oil prices over the past two weeks.

The price for each ton of gas oil reached dlrs 572 from dlrs 519 on the US market and to dlrs 515 from dlrs 480 on the Persian Gulf market in this period, he went on to say.

Among other features of the market for crude futures in the second month of summer were a high increase in price of gas which is the key source of energy for electricity generation, said Ghanimifard, adding that the price for each one million BTU gas hit its highest record of dlrs 9.70 in southern parts of the US mainly due to acute gas shortage in America. He said the US ports have not the possibility and facility to receive more LNG.

Furthermore, he added, gas imports through pipelines are barely enough to make good on seasonal domestic shortage in the US.

Southern parts of America was not the only region of the country to witness increase in gas prices, rather western parts of the United States also saw a hike to the effect that after several years ach million BTU gas was sold for more than eight dollars, he said.

He added that price of gas was also at the same level in Canada.

Elsewhere in the interview, Ghanimifard pointed to anxiety over fuel shortage in the autumn season as among other factors for increase in prices of petrol.

He said that since majority of refineries are working above their nominal capacity the possibility of meeting shortages is very low.

He added that among other market jitters are seasonal storms in the Atlantic Ocean in September, which can affect crude prices in the Gulf of Mexico and the US.

Yet, he said likely terrorist attacks on Saudi oil facilities and strikes against certain oil producing countries in the African continent or in northeast Europe are among other market concerns.

Asked to what extent Iran's nuclear issue had affected recent developments on the oil markets, Ghanimifard said market data show increase in the prices even when there was highest level of understanding between Iran and the EU3 and the International Atomic Energy Agency.

Ghanimifard said market analyzers and traders do not believe ongoing disagreements to have any impact on the current prices and only certain segments of media refer to the issue.

... Payvand News - 8/20/05 ... --

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