MADRID (AFP) — Oil prices surged to new highs Monday as leading figures from the energy industry gathered in Madrid amid growing public anger at the high cost of fuel and increasing concerns about inflation.
A week after failing to deflate the price of crude at a summit in Saudi Arabia, the world's biggest oil producers and consumers met at the World Petroleum Congress (WPC) to renew their search for ways of calming tense markets.
Pressure mounted Monday for a response as crude traded close to 144 dollars per barrel for the first time and 12-month inflation in the eurozone jumped to a record 4.0 percent in June.
New demonstrations were reported, including protests from French truck drivers that caused widespread disruption around Paris and a sit-in at the Madrid stock exchange to protest against the WPC.
Elsewhere, Iraq said on Monday that it had failed to sign technical support deals with global oil majors hoping to cash in on boosting the war-torn country's extensive but underexploited oil fields.
Iraq is still negotiating with Shell, BP, ExxonMobil, Chevron and Total, and a consortium of other smaller oil companies, to develop six oil blocks and two gas fields, Oil Minister Hussein al-Shahristani told a press briefing.
One of the main points of contention at the WPC is the role of speculators who are blamed consistently by producer countries for the doubling of crude prices over the last 12 months.
Western oil chiefs, backing the view of governments in consumer countries, insisted on Monday that speculators were the wrong target and that the failure of supply to match rising demand was the real cause.
"This is a fundamental thing. It's not about speculation," the chief executive of British oil group BP, Tony Hayward, told delegates, adding that it was a "myth" that speculators were to blame.
"Investors is a better word than speculators. They are investing in the oil market because they believe prices will go up."
Jeroen van der Veer, head of British-Dutch oil group Shell, also said blaming speculators was wrong, adding that the role of the market was "the translation of things that might happen in the future into the price."
More than 3,000 delegates, including leading corporate and political figures, are attending the World Petroleum Congress, which runs from Monday to Thursday after an official opening reception on Sunday.
"There's probably no better time for the WPC to be meeting," said Hayward.
The president of the Organization of Petroleum Exporting Countries, the head of the International Energy Agency and ministers from Nigeria, Russia, Venezuela, India, France and the Netherlands are expected to be present.
Saudi Arabia held a hastily arranged meeting of consumers and producers in Jeddah eight days ago to tackle the problem of record oil prices, which were forecast by OPEC's president last week to touch 150-170 dollars per barrel in the coming months.
Most experts agreed afterwards that the only concrete result from the summit was Saudi Arabia's announcement that it would increase daily production by more than 200,000 barrels per day to 9.7 million bpd.
The gathering pitted consumer nations, who are calling for an increase in production, against producers.
Most OPEC members remain firmly against any increase in production and blame speculators and the fall in the dollar for the remarkable run up in prices.
Western oil bosses, keen to pin the blame for high oil prices on a lack of supply, noted that they are excluded from many countries by governments anxious to see their national oil companies retain a monopoly on oil and gas production.
Fears about a military strike against Iran, the world's fourth biggest oil producer, is again driving crude prices higher after a fall in tension between the Islamic republic and the US and Israel since December last year.
Iran, the OPEC oil cartel's number two producer, has said that using oil as weapon is not on its agenda -- but has also not ruled it out.
The commander of the US navy's Fifth Fleet said in Manama on Monday that the United States would not allow Iran to shut the Strait of Hormuz, the Gulf sea lane through which much of the world's oil is supplied.
"They will not close it ... They will not be allowed to close it," Vice-Admiral Kevin J. Cosgriff told a press conference in Bahrain, where the Fifth Fleet is based.
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