International Energy Agency Foresees 'Rough Ride Ahead' for Oil

The price of gas has steadly risen at the pumps over the last few months, as the price of Brent Crude Oil has risen from $22.94 on April 29th to $28.15 on July 7th according to The Energy Information Administration. There is, however, good news for consumers as the price of crude oil is expected to drop. Unfortunately, though the price drop will probably not occur until 2004. Associated Press reports that the recovery of Iraq's oil producing capabilities next year will cause a significant increase in the supply of oil on the market. This oil, along with oil from independent producers, could cause the world price of oil to fall below the $22 to $28 threshold set by OPEC. OPEC will then face a difficult decision: Either settle for a lower price, or cut production to raise prices. Of course if OPEC cuts production they'll lose market share to non-OPEC countries.

If you're interested in the oil supply, you may want to see the following articles:

• "We Will Never Run Out Of Oil", an article showing why the doomsday scenarios are flawed.
• Reader Feedback to "We Will Never Run Out of Oil"
• "Will the War be Good for the Economy?" debunks the myth that there will be an economic benefit to the war in Iraq.

If you have any questions or comments on the oil supply or OPEC, you can either leave a message in the forums or send me a private message using the feedback form.