Middle East 'could cause price rise'

8 October 2007

The political situation in the Middle East could force the price of crude oil over the $100 (£49.08) a barrel mark next year, according to a market analyst.

Oil has risen by $20 a barrel this year to more than $80, due to concerns about producers' ability to satisfy growing global demand.

While that situation continues Ben Tsocanos of Standard & Poor's believes it would not take much to send the price soaring still further.

"If there were a real political crisis, like in Iran or any supply disruption, the oil market turns vulnerable to disruption or fear of disruption. So it is possible to hit $100 next year," he told AFP.

Mr Tsocanos' warning came just days after his company published a report suggesting that demand for oil is set to continue rising, despite moves to cut consumption in the US and Western Europe.

It noted that demand for energy from the burgeoning economies of China and India continued to rise, despite it becoming more difficult to find new sources of oil and natural gas.