Sunday, August 1, 2010

Oil prices are expected to average $63 next year, from $55.5 this year, the World Bank said in a report on the Middle East and North Africa released yesterday.

Those prices are “sufficient to avoid a major crisis in oil-producing countries, but much lower than the boom of 2008,” according to the World Banks’ ‘Economic Develop-ment and Prospects’ report.

The World Bank said that oil prices this year were unlikely to be significantly affected by the factors that had contributed to high prices before mid-2008.

“Global demand is likely to remain low,” said the report, released in the run-up to the World Bank and IMF annual meetings in Istanbul.

The IMF did not provide oil price projections for 2010 in its semi-annual World Econ-omic Outlook (WEO) report, published Thursday.

According to its WEO report, global oil demand is expected to rise to 85.7 million barrels per day (bpd) next year from 84.4 million bpd this year, but still be below the 2008 level of 86.3 million bpd.

Oil prices dropped below $70 a barrel on Friday.

Yesterday it was also ann-ounced that Iraq and oil majors British Petroleum and China’s CNPC International have agreed commercial terms for a joint venture to almost triple production at the giant Rumaila oilfield.

The signing of the deal for the 20-year venture, expected to cost $14 to $20 billion, is expected to take place within weeks, Middle East Economic Survey (MEES) quoted officials as saying.

This will be the first big upstream deal between Iraq and foreign oil majors since nationalisation of oil around four decades ago.