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Wednesday, 26 September 2018 13:00

Oil prices may return to $100 per barrel

Oil prices may return to $100 per barrel

The global economy could be damaged if oil prices return to $100 (£76) a barrel, experts have warned, after crude prices hit a four-year high of $82.16, Caspian Energy News (www.caspianenergy.net) reports with reference to The Guardian.

Some market watchers have predicted prices between $90 and $100 by the year’s end after OPEC last weekend rebuffed US President Donald Trump’s demands for the oil cartel to rein in prices by expanding production.

Moreover, PetroMatrix said, emerging economies’ growth could suffer because of steep crude prices causing inflationary pressures that lead to interest rate rises. Those countries could also be forced to cut oil taxes, widening budget deficits.

Any slowing in emerging markets would add to the recent economic challenges facing countries including Turkey and Argentina.

The price of Brent crude, the international benchmark, has crept up in the past week as it became clear that major oil producers were not planning to increase output.

Trump tweeted last week that the “OPEC monopoly must get prices down now”, but when the cartel met in Algiers on Sunday it focused on how a previously agreed increase would be divvied up, rather than a new boost.

Observers expect prices to keep rising, mainly due to concerns over the impact of US sanctions on Iranian oil exports from November.

The world’s energy watchdog, the International Energy Agency, recently said it expected the recent price range of $70 to $80 to be tested as the market tightened up. Some traders have been even more bullish, predicting $100 this year.

https://www.theguardian.com/business/2018/sep/25/rising-oil-prices-fuel-fears-damage-global-economy

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