Think-tank warns on oil price

OIL prices are some way off breaching the $50 barrier, but the Centre for Global Energy Studies warns that the supply shortage could get worse.

In its monthly report, the industry think-tank said: 'We are in the midst of an old-fashioned tight market...and it could get tighter still.'

Russian oil giant Yukos indicated its tax problems are likely to slow down oil output. It expects to produce 86m tonnes a day this year, down from previous forecasts of 90m and is slashing capital expenditure to save cash.

The expiry of the September crude futures contract in New York on Friday means all eyes are focused on the October oil price. It fell 72 cents to $46.00, well off the $49.40 high seen for September. Many traders expect another upward push later in the week.

Iraq oil exports have increased after a southern pipeline opened following a two-week shutdown. Exports are said to be at their highest level for several months.

In Nigeria, officials have slashed thieving to 50,000 barrels of oil a day compared to 300,000 last year - which could help ease supply pressures.