Korean Government Expects Oil Drop

The South Korean government predicts that international crude oil prices, currently at a 10-month high, would fall from February.

"The price of Dubai crude is expected to drop to the range of between US$26 per barrel and $27 per barrel from the current $29 per barrel," the Ministry of Commerce, Industry and Energy said.

Oil prices are at their current levels because of increased buying by speculators, a wintertime rise in demand, the weakness of the dollar, and the delayed recovery of Iraq's oil exports, the ministry said.

The ministry expects the drop will come from a fall in U.S. demand for crude oil and a rise in oil stockpiles.

Major U.S. oil refineries are expected to begin their annual repairs from next month, leading to a fall in global oil demand.

It further forecast international crude oil prices will range from $22 per barrel to $23 per barrel during the April-June period.

Thereafter, prices are likely to rise to a band of between $23 per barrel and $25 per barrel due to the recovery of the global economy and strong buying ahead of a rise in winter demand, the ministry said.