Monday, June 27, 2005

Ali talks - will they listen? 

As has been pointed out before despite all the talk about how high oil prices are they are in reality quite moderate. It was also mentioned that OPEC may therefore wish to re-adjust its price bands to reflect the ability of oil consumers to easily pay higher prices. It turns out the Venezuelan Foreign Minister, and former OPEC Secretary General as well as President of PDVSA, Ali Rodriguez is on top of the situation. Here are some of Rodriguez’s comments from the other day:

”The Organization of Petroleum Exporting Countries could return to a system of price bands but with a higher range between 40 and 50 dollars to reflect the new realities of the market.”

As Rodriguez was the first person to propose and implement the original price band of $22 to $28 his comments will certainly carry weight. Ali Rodriguez is a very astute observer of the oil industry. His former collegues in OPEC would do well to listen to him.


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