BP CEO sees long term drop in oil prices - Breaking News - Business - Breaking News

Oil prices could drop to about $US40 ($A53.96) a barrel in the medium term as new supplies are found, and might fall even further in the long term, according to the chief executive of BP.
However, Lord Browne cautioned that "we cannot really expect that prices will drop back sharply in the short term," in an interview published in the German weekly Der Spiegel.
He said large new oil fields are still being found and that regions such as West Africa have significant oil supplies.
Browne said sources such as Canada's oil sands also can be tapped profitably, adding that production costs still amount only to a small proportion of the price.
"It is very likely that, in the medium term, prices will stand at about $US40 on average," Browne was quoted as saying.
"In the very long run, even $US25 ($A33.73) to $US30 ($A40.47) are possible."
Oil prices have soared recently, pushed up notably by tensions over Iran's nuclear ambitions.
Iran said at the weekend it had accepted some parts of a Western offer aimed at getting it to drop its nuclear program, but rejected others.
© 2006 AP DIGITAL