Oil reserve decline is reason behind oil price hike

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(Xinhua)
Updated: 2008-07-05 01:05

NEW YORK -- US investor Jim Rogers has said that the decline in known oil reserves across the world is the main reason behind the skyrocketing oil prices that have already topped 145 US dollars a barrel.

While admitting that factors driving up oil prices are various, Rogers insisted that short of oil supply was the fundamental factor pushing oil prices up all the way.

"Nobody has discovered any major oil fields in over 40 years, while known oil reserves are declining amid a situation that the demand is boiling," he said, adding that oil prices will no doubt go higher unless somebody finds a lot of oil quickly, Rogers said in a telephone interview with Xinhua Thursday.

"Nearly every oil company has declining oil reserves, nearly every oil country in the world has declining oil reserves," he said, noting that "the known oil reserve will not last 100 years."

Rogers said that he was "not good at short-term trading" and predicting the price trend in a short period, but it is obvious that oil prices "will maintain an upward trend over a longer period" because the conflict between oil supply and demand is a big problem.

Rogers blamed the US government for driving down the value of the dollar, saying that the US government should do something about the currency.

He said he has been "very vocal" about the US dollar policy and criticized its "mistakes" as having been printing a lot of money since last August and lowering interest rates dramatically.

All these factors have helped drive up the prices of the dollar- dominated crude oil, he said.

Noting that the sharp rise in oil prices will change people's lives, he said they have to change their lives "accordingly."

Rogers highly recommended the use of nuclear fuel, saying that it is cheaper and cleaner than anything else, adding "if you are careful with it, it is safe."

In September 2007, Rogers sold his mansion in New York City for about 15 million dollars and moved to Singapore, mainly due to his belief that this is a ground-breaking time for investment potential in Asian markets.