Oil prices surged to near $54 a barrel in New York on 11 October 2004, shrugging off weekend assurances from Gulf ministers who had promised to pump enough crude to cool markets. Labor stoppages in Nigeria and Norway deepened supply anxiety.
Analysts were unsparing in their assessment. Deutsche Bank's Adam Sieminski said the group held "essentially zero" spare capacity, and that adding output capacity or rebuilding inventories would take months and weeks respectively, making near-term relief unlikely.
Saudi Arabia's oil minister said the kingdom was producing at full capacity and that no shortage existed. The UAE announced plans to raise output by one million barrels a day, but not before 2006, a timeline analysts at Societe Generale said would do little to move current prices.
OPEC's available reserves are also mismatched to market needs: its spare crude runs heavy and sulphur-rich, while refiners prefer the lighter, sweeter grades Nigeria normally supplies.
Kuwait's energy minister placed the blame on psychology and politics, pointing to fears tied to Iraq and Nigeria as the force behind surging prices, rather than any underlying imbalance between supply and demand.
Historical summary. TurkishPress restated this AFP wire report, first published in October 2004, in its own words.