CGES calls for discounted oil prices

23 July 2008

The Centre for Global Energy Studies (CGES) has produced its monthly oil market report, calling on producers to make crude oil more affordable.

It said Opec, the world's largest oil producing cartel, should offer its heavy, sour crude at lower prices, the Economic Times reports.

Heavy grades cost more to refine than the commonly traded light, sweet oil, but the report stated that Opec needs to recognise that supply must increase and put prices at a "viable" level.

Energy consultancy firm CGES also observed that Opec seems to be striving for the upper limit for the cost of a barrel, suggesting that recent sharp falls imply that would be $150 (£75).

"If not, then we can expect oil prices to surge again until they rise high enough to drive the world deeper into recession," the report added.

The International Energy Agency recently warned that prices would continue to rise until at least 2013, driving up fuel and home heating oil costs.

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