Another reason for high prices in the short term:

Opec oil output will fall by 200,000 barrels per day in July because of lower production from top world exporter Saudi Arabia and from Venezuela, consultant Petrologistics said yesterday.

Conrad Gerber, head of the Geneva-based consultancy, estimated that the Organisation of the Petroleum Exporting Countries is pumping 29.9 million bpd in July, down from a revised 30.1 million bpd in June.

The estimate suggests supply from Saudi Arabia has yet to rebound after the kingdom cut output in April as refinery maintenance and rising inventories curbed demand. Most Opec members were pumping near full tilt earlier this year to cool prices.

Full article here.

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