$100 right price for oil says Al Naimi
Kuwait, March 25, 2013
Around $100 a barrel is a good price for oil, Saudi Arabia's Oil Minister Ali Al Naimi told reporters on Monday on the sidelines of an energy conference in Kuwait.
Asked what a fair price would be for consumers and producers, Al Naimi said: "I just came from Hong Kong and I told everybody, in 1996, I thought $20 a barrel was reasonable; in 2006 I thought $27 a barrel was reasonable and now it is around $100 a barrel. I told them again it is reasonable."
Brent crude rose above $108 on Monday after euro zone ministers approved an EU-IMF plan for restructuring Cyprus's banking sector, which could put the euro zone recovery back on track, stoking demand for oil.
Cyprus clinched a last-ditch deal with international lenders for a 10 billion euro ($13 billion) bailout that will shut down the Mediterranean island's second largest bank and inflict heavy losses on uninsured depositors, including wealthy Russians.
"This is certainly very good for risk appetite overall and that's going to have a positive impact across oil markets, so we should see some positive sentiment reverberate through energy markets overall for at least the next 24 to 48 hours," said Ben le Brun, an analyst at OptionsXpress in Sydney.
"But it carries on with the theme of Europe coming up with an 11th hour agreement, so I don't know how much risk premium was actually being priced into markets overall because there was a growing expectation that they were going to come up with a plan at the last minute as usual."
Brent crude had gained 34 cents to $108.00 a barrel by 0228 GMT, while US crude increased by 34 cents to $94.05. - Reuters