London, May 20, IRNA - Oil prices are likely to continue to rise reaching an average of 140.4 dollars per barrel (dpb) by the final quarter of this year should non-OPEC supply fail to meet pessimistic forecast, according to the Centre for Global Energy Studies (CGES).
In its latest monthly oil report, the London-based centre said benchmark Brent dated crude would average the current record of more than 120 dpb for the year if OPEC's production profile and global demands are maintained.
"The world needs more crude oil to meet demand and restore inventories," the report warned.
"Non-OPEC supply in 2008 has already begun to fall well short of earlier expectations," it said.
CGES referred to "substantial" risks to non-OPEC production, including rising production in Kazakhstan and Azerbaijan acting only to offset Russian production losses and concern about the ability of Mexico, Australia and Brazil to increase supplies in 2008.
"These worries lend themselves to the construction of a case in which seemingly robust global oil demand is affected adversely by soaring oil prices," it said.
Even in its reference case, the centre said tightness of supply in the face of growing economic uncertainty was the story behind its forecast of Dated Brent crude staying over 120 dpb in the third quarter before easing back in the final quarter.
Its low price case of prices averaging still over 100 dpb for the year depended on the world economy slipping into recession and thereby needing less oil.
The bleak report comes as British Prime Minister Gordon Brown outspokenly blamed OPEC for the tenfold rise in oil prices in recent years.
"It is, as people will recognise, a scandal that 40 per cent of the oil is controlled by Opec, that their decisions can restrict the supply of oil to the rest of the world, and that at a time when oil is desperately needed, and supply needs to expand, that Opec can withhold supply from the market," Brown told a conference on Monday.
But CGES, founded up by former Saudi Oil Minister Zaki Yamani, said the only country that can boost production by a significant amount in the short term is Saudi Arabia and had "shown little sign that it is willing to boost its production."
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