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Oil prices risk rebounding above $100, says Total chief Christophe de Margerie

Oil prices risk rebounding far above $100 a barrel unless there is greater investment in energy exploration, the head of French oil giant Total said in an interview broadcast on Monday.

But he also told the BBC that oil prices at their current level of about $70 were too low to support long-term investment by his company.

At the same time Mr de Margerie said it was not the sole responsibility of oil producers to fund new investment.

The global economic downturn had sapped demand for energy, dragging crude prices from record highs of above $147 a barrel in July 2008 to $32.40 in December. They have since won back some ground to stand close to $70.

Asked by the BBC if oil could go back “well-above” $100 a barrel, Mr Margerie said “Yes,” adding: “The problem is when, the problem is to anticipate this, not to send [a] message to scare people but to send a message … ‘it’s important to invest now’.

He said prices of $60-$70 a barrel was not enough to protect our long-term investment.

Mr de Margerie warned of a possible oil shortage between now and 2015 if immediate action were not taken on investment in exploration.

“We might be faced with insufficient oil to cover demand and I think it’s our role to say it in advance … to force people in charge of our countries to think about this concern we have and we need to share and prepare because in two, three years’ time it will be too late.”

He added: “The reserves of oil are there but if you don’t invest they don’t come on the market.”

Mr de Margerie said oil producers, including the world’s second biggest Saudi Arabia, needed help from non-producers.

“You cannot ask those countries which also are facing the [economic] crisis …to continue to invest for a potential recovery of the demand … for the benefit of the rest of the world,” he said

via Oil prices risk rebounding above $100, says Total chief Christophe de Margerie – Telegraph.

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