$70 a barrel is the right price to help maintain a steady flow of investment from companies and resources into new resources, according to Qatar's oil minister, Abdullah al-Attiyah.
Speaking at 'Petrotech', India's biggest oil and gas conference, Mr. al-Attiyah, said: "Low prices will reflect a freeze in investment in new resources. When growth comes back, we will have another shock, as resources will not be there to meet demand." Following a rollercoaster year for oil prices Qatar is the second Organisation of Petroleum Exporting Countries (OPEC) nation to have one of its officials speak out about a suitable price for oil to trade at.
In late November, when prices were floating around the $55 a barrel mark, a Saudi Arabian official claimed that $75 would be a fair price for crude. It was the first time in several years that the world's biggest exporter of oil had identified an optimum price level.
Qatar currently produces around 7.35 million barrels per day (bpd) and carries a surplus of 9.0 million bpd. Mr. al-Attiyah bluntly added: "Oil prices over $100 are not logical. I also don't appreciate low oil prices."
While OPEC has attempted to stamp its authority upon prices, through a series of quota cuts, prices have continued to react primarily to external influences: such as plummeting demand levels and falling forecast figures.
The producer-cartel decided to cut quotas by 2 million bpd at collective meetings in September and October of last year. Then in December it agreed to lower output by a further 2.2 million bpd – from the start of the new year onwards.
Initial cuts failed to make an impact on the markets, largely due to an air of skepticism surrounding the organisation's ability to successfully implement and monitor the cuts across all of its member states. Being well aware of this al-Attiyah said that members of OPEC had complied with the cuts: "so far, so good".
Yet even with successful implication the cuts have failed to create the desired floor to prop up falling prices. Unsurprisingly hearsay talk of OPEC calling an early meeting in February has begun to spread; something the oil minister was quick to quash.
In a decidedly objective statement al-Attiyah said that oil producers should not smile when crude prices are at record highs, just as consumers should not be grinning from ear-to-ear when prices at the pump are low, quite simply because both are counterproductive for the long-term development, and stability, of the industry.