Oil Prices with its movements rise and down became nowadays the main interest not for those who are interested in oil sector but for all people due to its influence on many areas in life by its wide use in oil derivatives : in housing, transportation ,industry, electricity, agriculture, etc.
In order to have logical and convincing answers for legitimate questions on the truth of oil markets situation we must address the factors of oil price swings and changes. Perhaps one of the most

influential in the great changes during the current year and the past two years, is the geopolitical and security situation prevailing in the Middle East and especially the Arabian Gulf region due to wars and unrest existing military. And joining it is speculation and betting that the price of global stock exchanges by experts in order to profit on the one hand and recording the positions of economic and political, on the other. And this remains the reference for the transformation of oil prices is supply and demand, which covered the above-mentioned factors had a limited role in this period that we are talking about. Because as we know that OPEC has increased production and reduced, but this did not reflect a significant impact on prices.

There is no doubt that there are several other factors, sometimes in so doing receive the price of oil, including oil reserves of the commercial oil companies and the U.S. strategic oil reserves and the limited quantities of oil derivatives is the limited number of refineries in the world, a movement to influence share prices with the prices of crude oil.

The question now is whether the oil price rises will continue in this period, after flying to around 150 dollars a barrel and dropped quickly to 32 dollars a barrel?
There will be no price of crude oil by the end of this year. And is the current rises in oil prices is a reflection of real activity and global trade association in the field of the global financial crisis and economic rotation of the wheel.

 
The arrival of the price of crude oil up to 60 dollars a barrel, the highest since the beginning of this year represents an increase of 80% since last January and brings the price of crude oil while the balance of supply and demand around the world. However, the geopolitical factors are still present in the arena and play a role in moderation now and the impact of rapid economic growth of China and India as well, there is the result of the impact of exchange rate depreciation of the dollar globally.

Difficult to forecast that oil prices will rise automatically, without an improvement in the performance of the global economy and the public often do not expect oil prices to increase the rate of 70 dollars by the end of this year without an increase in global demand for oil, or reduce the oil-producing countries, especially the production of Organization ‘OPEC’.

The current oil price is reasonable, to some extent has been accepted by the logic of the circumstances of economic and financial world. If we refer to the carefully considered the price of the Organization of Petroleum Exporting Countries during the years 2000 – 2002 it was estimated at 35 dollars a barrel on the basis that it achieves a balance between producer and consumer, and if we have a comprehensive economic accounts after 7-8 years, we will reach almost to the current price.

Dr. Ibrahim Haddad
Former oil minister
Prime Minister Energy Adviser