Navtej Kohli on Rising Oil Prices and OPEC Production

Navtej Kohli Blog Brings a New Insight into Rising Oil Prices

Oil prices are rising rapidly due to increase in consumption and decrease in production. To worsen the matters the Organization of Petroleum Exporting Countries (OPEC) will not increase its oil production to help curb soaring prices of crude oil, the organization's president said Tuesday.

The United States and other Western countries have asked OPEC to increase output to cool prices and ease the pressure on their economies.

OPEC members said the recent rise in oil prices was mainly due to speculation and the weakening U.S. dollar.

OPEC President Chakib Khelil, said OPEC will leave output unchanged because international demand for oil has not grown, local media reported.

A possible recession in the United States will slow down the growth of the world economy and reduce the world's demand for oil, Khelil said, adding that in the long run, OPEC's output should be reduced.

Venezuela's oil minister Rafael Ramirez also said here Monday that it would be impossible for OPEC to increase its oil output. He even indicated the possibility of a cut.

These comments came at a time of record oil prices, and experts predict they will continue to rise if the upcoming OPEC ministerial meeting decides to keep output unchanged or cut down production.

Crude oil for April delivery surged to an all-time high of 103.95 dollars a barrel on the New York Mercantile Exchange in early morning trading Monday.

According to the cartel's secretariat, the daily average oil prices also kept rising Monday, reaching a new record high of 97.26 dollars a barrel.

Now the question arises that if OPEC decides to cut oil production then what would be the impact on the global oil needs. Well, I guess it's time to take your bikes out and reduce your consumption of oil.