DUBAI: The rise in oil supplies on global markets does not justify the sharp drop in crude prices, a top OPEC official said on Sunday, arguing speculation might be a contributor.
“We want to know the main reasons that have led to such a drop in oil prices,” said Abdalla Salem el-Badri, secretary general of the Organization of the Petroleum Exporting Countries.
“When we look at supply and demand, there is a rise [in supply]but only a modest one that should not have led to this 50-percent drop,” he told reporters at a conference in Dubai.
“Speculation is strongly contributing to pushing prices down,” he added.
OPEC decided last month to maintain its production level despite pleas by some producers to cut output in order to curb the price drop.
Badri said OPEC had kept oil production at about 30 million barrels per day for the past decade, while countries outside the cartel had pumped an extra six million bpd.
Oil prices tanked to new five-year lows on Friday after a gloomy crude demand downgrade from the International Energy Agency (IEA) and more weak economic data in China.