Oil Price Close to $ 30

The international oil price is forecasted to sharply rise up due to the Iraq`s sudden stoppage of oil exports.

According to the Korea National Oil Corporation yesterday, the amount of the Dubai oil to be delivered on July was closed at $27.16, $0.31 higher than the previous day (4th). The Dubai oil has constituted most of the imported amounts. The average price of the Dubai oil was $24.18 on April, and $25.43 on May.

The Dubai oil had soared to $27.62 due to the Iraq`s threat to stop the oil exports in defiance of the UN`s measure to extend the oil-for-food program and dropped to $26 level. But as Iraq decided to halt the oil exports for one month, the Dubai oil went back to $27 level. This is higher than the government`s estimated price ($25-26 a barrel). It is rare that the price of Dubai oil maintains $27 level in summer which is a low-demand season.

For the Brent oil produced in the North Sea and the fair-average-quality oil produced in West Texas Intermediate, the amount to be delivered on July also was closed respectively at $29.2 ($0.4 up) and $28.09($ 0.19 up).

Another reason that the international oil price soared is that because the demand in Asian regions has enlarged due to the establishment of the new oil refining companies in China and the East Asia, and the demand on the gasoline has increased in the U.S. during the summer vacation season.

Meanwhile, the Organization of the Petroleum Exporting Countries(OPEC) producers agreed to maintain current output supply ahead of the 115th general meeting which was held yesterday, reported the foreign news. It added that because Saudi Arabia and Kuwait which are the biggest oil exporting countries, have possessed the considerable amount of oil for exports, the international oil price is not likely to soar up in a near future.

Kwon Ki-Tae kkt@donga.com