The Indonesian Crude Price (ICP) is expected to range between 47 US dollars and 53 US dollars a barrel next year as tight capacity in refineries worldwide keep global oil prices high, an OPEC official said.

A lack of new refineries would keep the market edgy thus offering leeway to speculators, Indonesia's OPEC governor Maizar Rahman was quoted Tuesday by The Jakarta Post newspaper as saying.

However, global oil prices would decline steadily over the next two or three years to around 50 to 60 dollars per barrel, said Maizar.

"Prices in 2006 will be some 5 US dollars per barrel lower than in 2005," he said.

The government said in mid-August that it would use an oil price assumption of 40 dollars per barrel in next year's budget. The ICP is an index that reflects the prices of various types of crude oil produced here. The ICP stood at 59.26 dollars a barrel on Monday afternoon.

Minister of Energy and Mineral Resources Purnomo Yusgiantoro said at the time that international prices would decline by up to 15 dollars a barrel as the global economy slowed down and fear of political unrest in oil-producing countries abated.

President Susilo Bambang Yudhoyono said last Wednesday that he personally thought that 55 US dollars were more realistic as the oil price assumption for the 2006 budget.

Despite being an oil producer, Indonesia finds itself unable to reap windfall profits from the current sky-high oil prices as output has steadily declined over the past five years while domestic oil-based fuel consumption has been rising.

Oil and Gas Upstream Regulatory Agency (BP Migas) chairman Kardaya Warnika said that crude and condensate production would stand at 1.11 million barrels per day (bpd) on average next year, 5 percent higher than the expected full year figures for 2005.

In August, oil production stood at 1.077 million bpd as compared to 1.049 million bpd the previous month due to higher output here from state oil and gas firm PT Pertamina and US firm Unocal, said Kardaya.

Production in December would reach 1.089 million bpd as more oil would be pumped from PetroChina's Sukowati field and Santos' Oyong field in Madura, he added.

"Output will remain this high until March 2006, when the wet season will make it difficult to jack up production," said Kardaya.At the end of next year, the coming on stream of a number of new fields is expected to raise production to 1.115 million bpd.

In light of the soaring oil prices, the government is considering hiking the prices of subsidized oil-based fuels -- premium gasoline, diesel and kerosene -- after October.

Source: Xinhua