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Saudi foreign minister says oil records due to 'speculation'
DAKAR
Petroleumworld.com, Mar 14, 2008
Saudi Foreign Minister Prince Saud al-Faisal said Thursday that global oil prices had hit record levels because of "speculation" and not underlying market conditions.
"The current turbulence on the oil market is due in large part to speculation and has nothing to do with market fundamentals, which are stable," the prince told the Organisation of the Islamic Conference summit in Dakar.
The prince's comments came as oil hit a fresh record high 110.70 dollars per barrel on Thursday, driven by investment demand to hedge against the weak US dollar and higher inflation, dealers in London said.
They said that as the dollar plumbs new depths because of fears the US economy has fallen into recession, investors are looking to commodities -- especially oil and gold -- as a hedge against hard times.
The United States has been pressing OPEC, which pumps 40 percent of the world's oil and where Saudi Arabia is the dominant player, to boost output to cool prices.
US President George W. Bush said Monday he was sending Vice President Dick Cheney to the Middle East next week to, among other things, press home this message.
OPEC at a meeting earlier this month declined to hike output, repeating that it believed the oil market was well supplied and that record prices reflected only speculative trade.
Story from AFP
AFP 13 1406 GMT 03 08Copyright© 2008 respective author or news agency. All rights reserved.
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