Dubai, Sept 19: The International Monetary Fund (IMF) has said that oil prices will remain volatile next year and warned against possible "shocks" that could threaten economic recovery. "Oil prices are likely to remain volatile and future shocks could again affect economic prospects," said the IMF in its world economic outlook report, released in the Gulf Emirate of Dubai.
"The uncertainties surrounding the near- and longer-term outlook for world oil demand and supply suggest that oil prices could deviate significantly from the path implied by future markets."
The report said the market expected prices to be sustained near current levels of 26-27 dollars per barrel, and to drop to 25 dollars in late 2004 because of increased production in Iraq, West Africa, Brazil, the Gulf of Mexico and the Caspian.
"Barring weather-related or other shocks to oil demand or a resurfacing of political tensions in Nigeria, Venezuela or elsewhere that could affect supply, there could be well significant downward pressure on oil prices." Bureau Report