HOUSTON — Energy leaders from around the world meeting in Houston this week have a consistent message about high oil prices: Don’t panic.
Oil has risen 24 percent in the past three weeks, settling at $104.38 a barrel Wednesday. In that same time, the average price of regular unleaded gasoline in the U.S. has increased 40 cents a gallon to $3.52, the highest since September 2008. This is straining the wallets of drivers and raising fears among economists that high energy prices will stall the nation’s economic recovery, lead to inflation or both.
The price is near $4 a gallon in such West Coast cities as San Francisco.
Rex Tillerson, chief executive of Ex xon Mobil, acknowledged Wednesday while speaking to reporters in New York that $4 gasoline would strain the budgets of American families.
Oil prices are high primarily for two reasons, analysts say. They rose above $90 a barrel late last year as a result of rising global demand for oil, especially from China, India and other developing economies of Asia. More recently, fears that widespread unrest in the Middle East would significantly disrupt supplies pushed prices even higher.
But oil ministers from the Middle East and executives of international oil companies gathered in Houston say there is plenty of oil flowing to meet worldwide demand, currently around 87 million barrels a day.
That’s even with the supply disruption caused by unrest in Libya, a member of OPEC.
“There is no shortage of oil in the market,” said Youcef Yousfi, the Algerian minister of energy and mines, in a meeting with reporters. The high price, he said, is a result of the “hardly predictable logic” of oil traders in the financial markets.
Those traders may be listening to another group with a consistent message: geopolitical analysts. They contend that the unrest in the Middle East, which has toppled governments in Tunisia and Egypt, is in its early stages. That raises concerns about disruptions to supplies from Saudi Arabia, the world’s biggest exporter of oil, and Iran, the second-largest member of the Organization of Petroleum Exporting Countries.
Jim Burkhard, managing director for global oil at research firm IHS Cambridge Energy Research Associates, took the middle ground.
“There are no gas lines, and we are not running out of barrels of oil,” he said. “But it’s difficult to overestimate the importance of the Middle East to global oil markets.”
