OPEC's Lukman says oil set to fall after U.S. polls

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OPEC's Lukman says oil set to fall after U.S. polls Reuters, 11.04.00, 5:14 AM ET

TEHRAN, Nov 4 (Reuters) - OPEC secretary-general Rilwanu Lukman said on Saturday he expected oil prices to come down after the U.S. presidential elections next week.

The main reasons for what he called the artificially high price of oil was a shortage of fuel oil in the United States and the continuing tension in the Middle East.

But the November 7 elections were also a factor, Lukman said. "There is some politicisation of the oil market because of the presidential elections," he told an energy conference in Tehran. "It is unfortunate, but it is there. We have to wait for after the elections and then the market will cool."

Some Iranian energy analysts have suggested oil prices are being kept high in order to damage the incumbent U.S. administration and favour Republican presidential candidate George W. Bush, the oil industry's preferred man for the top job.

"Some analysts think that at least a couple of dollars of current prices are because of election-time politics in the United States," Lukman said. "After the 7th (of November) it will be surprising if the market does not change."

He said even after the recent 500,000 barrels per day (bpd) production increase OPEC still had capacity to increase output by between two and 2.5 and five million bpd.

Once winter in the United States was over there would no longer be the pressure on fuel oil and that would be another factor forcing prices down, Lukman said.

But if prices edge below the bottom end of OPEC's $22 to $28 preferred range, the cartel would take action.

"If prices go below $22 a barrel next year, there is no magic involved, we will cut production." Copyright 2000, Reuters News Service.

http://www.forbes.com/newswire/2000/11/04/rtr119206.html

-- Martin Thompson (mthom1927@aol.com), November 04, 2000


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