Jakarta (ANTARA News) - The crude oil price in the world market may fall to US$70 a barrel at the end of this as a result of the on-going global economic crisis, oil and gas industry observer Pri Agung Rakhmanto said. "The current global financial crisis will push down world demand for oil and gas, and the prices of these commodities will also fall," Rakhmanto said here on Tuesday. Rakhmanto, who is also executive director of ReforMiner Institute, said a decline in demand for oil would be a fundamental factor in the downward spiral of crude oil prices. The global economy would slow down and grow only 3.6 percent, he added. "If investors and speculative buyers stay in a wait-and-see position for a relatively long time, the price of oil will drop to a range between US$70 and US$80 per barrel at the end of the year," he said. Another oil observer, Kurtubi, concurred with Rakhmanto, saying crude prices would continue to slide until US$70 per barrel if oil production is not reduced by up to 1.5 million barrels per day. He said if the Organization of Petroleum Exporting Countries (OPEC) cut its production by 1.5 million barrels per day and the US dollar weakened, the oil prices would, however, return to US$120 per barrel. He said the strengthening of the US dollar against the euro would also help drive down oil prices. "So, although there would be an upward trend in oil consumption in the runup to the winter season, the oil price will remain under pressure," he added. Rakhmanto said if the oil price dropped to an average of US$85 per barrel in 2008, Indonesia`s oil and gas revenues would drop by Rp30 trillion to Rp211 trillion. Crude prices had dropped to US$90 a barrel following fear that the financial crisis in the United States would spread to other countries even though the US government had provided a US$700 bailout package for collapsed financial institutions.

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