WASHINGTON - Forecasts that oil prices could surpass 100 dollars a barrel are not "outlandish", a senior International Monetary Fund official said Thursday.
Commenting on a study by investment bank Goldman Sachs that predicted oil prices could go as high as 105 dollars a barrel, IMF senior economist Raghuram Rajan said that scenario was possible.
"To the extent that there is some kind of a supply disruption, 100 dollars a barrel does not seem outlandish," he told reporters.
But Rajan added: "Is it the most likely scenario? I think not necessarily; it depends on how the market evolves.
"The point that we want to make is that the market is tight," he said, presenting an IMF study on the oil markets that forms part of the organisation's twice-yearly World Economic Outlook report.
"So large movements either in demand or in supply can have significant effects on price," the IMF official said.
But Rajan also played down the historical parallels to current price trends that have seen oil prices surpass 58 dollars a barrel recently.
"Remember, even with a spike to about 80 or 100 dollars we are barely approaching the (nominal) level that we approached in 1979," he said in reference to the last big global oil shock, caused by the Iranian revolution.
Goldman Sachs analyst Arjun Murti last week predicted that US oil prices were in the early stages of what he called a "super spike" period.
He raised the bank's medium-term forecast from a previous estimate of 80 dollars to 105 dollars per barrel on the back of "strength in oil demand and economic growth, especially in the United States and China".
The market rallied strongly on the forecast. But several traders said such a figure was years away and would only come about if there is major, and unlikely, disruption to global supplies such as a Saudi export embargo.
The IMF's own study predicted that in 2030, the average price of a barrel of oil would stand in the range of 39-56 dollars in real terms.
In nominal terms, without adjusting for inflation, the price would be 67-96 dollars, it said.
Fears of an economic crunch have intensified with oil prices up by around 40 percent since the start of the year.
IMF chief Rodrigo Rato warned this week that the high prices would shave between 0.25 and 0.5 percentage points off global economic growth this year.
04/07/2005 19:11 GMT