RIYADH, July 21: Pundits believe that another round of crude price spiral is just round the corner. A Goldman Sachs report says the US crude prices could top $90 a barrel this autumn and hit $95 by the end of the year, if Opec keeps oil production capped at the current levels.

“Our estimates show that keeping Opec production at current levels and assuming normal weather this coming winter, total petroleum inventories would fall by over 150 million barrels or 6.5 per cent by the end of the year, which would push prices to $95 a barrel without a demand response,” the report added.

The London based Centre of Global Energy Studies in its monthly oil report for July, also expects the prices to cross $80 mark in the coming months.

CIBC world markets reports also projected this week crude prices to be $80 a barrel later this year and to $100 by the end of 2008.

Billionaire investor Boone Pickens sees oil price getting to $100 mark in the ‘worst-case’ scenario. Barring even the worst case scenario, oil prices will rise to $80 a barrel within six months, Pickens predicted. Pickens bullish bets on energy have propelled him into the Forbes list of the richest Americans.

Deutsche Bank AG raised its “long-term” oil price forecast to $60 a barrel, from $45, saying that the outlook is “extremely bullish.”

And despite all this, the global thirst for crude is set to rise in the coming months.

The International Energy Agency now projects the global demand to go up by an average of 2.2 million barrels a day next year — up from 1.5m barrels a day increase estimated earlier the year.

And the total global consumption is set to touch 95.8 million barrels a day by 2012, from 86.1 million bpd in 2007, assuming an average global GDP growth of 4.5 per cent per annum.

In the meantime, the US National Petroleum Council — a board of high-level US oil industry executives - released its study titled ‘Facing the hard truths about energy,’ conducted at the behest of US Energy Secretary Sam Bodman.

As per the report's executive summary, though the world is not running out of oil but there are “accumulating risks” to securing supply through 2030.

On the other hand, the issue of having energy from sources other than fossil fuel, for a host of reasons, is still not very promising. “Regarding non-conventional oil supply and bio-fuels, the most significant growth is expected to come from Canadian oil sands, which is seen rising in the reference case to five million bpd in 2030 from just one million in 2005,” said the Opec World Oil Outlook, 2007.

The global production of bio-fuels would touch 1.75m bpd by 2012 — more than double the 2006 levels — yet marginal. With the fossil fuel continuing to dominate the energy mix by far, the issue remains, from where this additional capacity could come?

The IEA as well as the Opec expect increasing reliance on the oil cartel. The IEA has trimmed its forecast of non-Opec supply by 800,000 bpd in 2011. Consequently, the call on Opec would rise to 34.7 million bpd in 2011, higher than its previous projections by 1.3 million bpd.

Opec has also raised its estimate for call on its oil. It has also cut its estimates of non-Opec oil supply, citing “weak performance” in Norway.

OPEC believes the demand will rise 1.5 per cent in Q1 ‘08 to 86.9 million barrels a day, lower against the 2.5 per cent projected by the IEA.

But for Opec to continue meeting its growing obligations, there are issues to be addressed. “Today’s policy announcements (about reducing dependence on oil) could translate into scarcity of supplies in the future,” warns Mohammad Al-Hamli, the Opec president and the UAE oil minister. If the demand is unclear, it would be unwise and wastage of badly needed funds for the developing nations of Opec with limited resources to invest heavily in oil production, he remarked at an energy conference. Security of demand is key issue for us, Al-Hamli stressed.

In fact it is not a key issue for the oil producing Opec member states alone; it is an issue of global importance, of shared responsibility. The growth of this fuel driven civilization depends on continued availability of fossil energy resources.