Oil price will go over $100 if US or Israel attacks Iran: Yamani

London (Platts)--21Mar2007

Oil prices will go over $100/barrel if either the US or Israel attacks
Iran, former Saudi oil minister Sheikh Zaki Yamani said Wednesday.

"If America or Israel attacks Iran" then Iran would probably react,
Yamani told reporters in London, and then "the price of oil will go three
digits."

"If you think logically this should not happen," he said, adding however
that decisions are sometimes taken which are "against logic...like the
invasion of Iraq."

With regard to the current oil market, Yamani said that high oil prices
were not in OPEC's interest and that the cartel may be able to raise
production if output from non-OPEC producers is not as big as expected.

"If non-OPEC doesn't produce as much as expected OPEC doesn't have to
continue cutting," he said.

"I don't think OPEC knows what is the price they want," said Yamani,
adding: "Now $50 is a bad number for them."

"A high price of oil is not in the interests of OPEC, I can assure you,"
he added, saying this would encourage energy conservation and the use of
alternatives to oil.

"OPEC will pay the price but not immediately. It will take time," he
said.
Asked if oil prices of around $60-65/b were healthy for the world
economy, Yamani said: "No, no."

"I think it is bad for OPEC," he added.

Yamani said, however, that high prices would be good for the finances of
producing countries, allowing budgeted spending plans to go ahead.

"Saudi Arabia will not be happy with a price like $40, it's a bit low,
they cannot continue their policies and their programs," he said.

Asked what oil price he thought Saudi Arabia, OPEC@s biggest producer,
wanted, Yamani said: "The Saudi oil minister [Ali Naimi] said between $50 and
$60, you take it from the horse's mouth."