'Demand driven': Eni chief executive Paulo Scaroni
Scaroni sees oil shock continuing
Record-high international oil prices will keep rising until Western countries rein in their demand, Paolo Scaroni, chief executive of Italy's biggest oil and gas company Eni, was quoted as saying on today.
US crude hit $143 a barrel today amid concerns stirred by a lower global oil supply and tensions between Israel and Opec member Iran.
"The price will continue to rise until we see a correction in western demand," Scaroni told Italian newspaper La Repubblica in an interview, Reuters reported.
Scaroni said the price might rise up to $200 a barrel, spurred by strong demand and speculation, or fall back to $120 a barrel in August as a lot of factors could swing the price either way.
"Nothing is linear or predetermined," he said.
Scaroni said US consumers have already been making efforts to trim energy demand as they cut on car travel, opt for trains and buy smaller automobiles.
Eni, which is one of 35 energy companies qualified by Iraq's government to bid long-term development oil contracts, would take part in tenders, Scaroni said, adding the group would open an office in Baghdad. Scaroni also reiterated Eni's commitment to continue working in Iran despite a pressure from the US government to exit the country which is under UN sanctions over suspicions that it is secretly preparing to build nuclear weapons.
"We have invested a lot in Iranian projects and if we leave we would lose between $2 billion and $3 billion... We do not plan to do new contracts but we cannot allow ourselves to leave without causing a big damage to shareholders," Scaroni said.
Eni would exit Iran only if Italian government or the UN declared a force majeure there, he said.