Gazprom chairman warns that rapid rise in oil price is set to continue

The head of the world’s biggest energy company has predicted that the oil price will reach $250 per barrel in the ‘foreseeable future.’

Alexey Miller, chairman of Russian gas giant Gazprom, made the prediction in a speech he was giving to the European Business Congress in Deauville.

Miller explained the forecast by references to demand from the developing world. He said the surge in hydrocarbon prices was down to new emerging economic power houses with fast rates of industrial growth creating increased demand for oil and gas.

The energy markets are experiencing a growth in prices and increased competition for existing resources, he said.

‘There are three major markets that are fiercely competing for gas: Europe, Eastern Asia and Northern America.’

The energy chief also criticised Europe’s approach to dealing with Russian energy suppliers and expressed concern about certain protectionist tendencies.

He commented: ‘Europe’s desire to diversify energy supplies is very understandable. But this talk seems to be based on a strange assumption that anything is better than to rely on Russian energy suppliers. It is hard to see a justification for this misplaced belief.’

‘We rely as much on European consumers as they depend on us,’ he said

In an alarming warning, Miller said that by pursuing a protectionist strategy Europe was running the risk of not only an energy deficit but deindustrialization of the continent.

Gazprom fact file

Gazprom is the third largest company in the world with a market capitalization approaching three hundred and sixty billion dollars and overall hydrocarbon reserves estimated at nearly thirty trillion cubic meters.

The last six years saw the Russian gas production growth top the world industrial charts.