OPEC Chief Predicts Oil Prices Will Continue to Rise

MADRID, May 26, 2008 (Dow Jones Newswires)

The price of oil will continue to climb, especially if there is no improvement in the outlook for the dollar, OPEC president Chakib Khelil told Spain's national radio Monday.

"We are going to witness a price rise," especially if the economic situation in the United States persists and the dollar continues to decline, he said.

The U.S. economy has been buffeted by a lingering housing market slump, a related credit crunch, increased job cuts and record high crude oil prices.

Oil rose in Asia on Monday and was trading at around $132 a barrel, not far from the all-time high above $135 hit last week amid concerns about inadequate output and robust demand.

Khelil blamed the soaring price of oil on speculators, geopolitical problems and the weakness of the dollar, all "factors beyond the control" of OPEC.

"If OPEC decides to raise production ... these hikes will not really lower the price," said Khelil, who is also the Algerian energy minister.

A falling dollar makes commodities such as oil cheaper for those with stronger currencies and so in part encourages demand.

MADRID, May 26, 2008 (Dow Jones Newswires)