Crude oil prices rose above $61 per barrel on Monday after Saudi Arabia reported the death of King Fahd. He will be succeeded by Crown Prince Abdullah, his half brother, who has been acting ruler since King Fahd suffered a stroke in 1995.

Because of this continuity of rule, Saudi Arabia’s oil policies are not expected to change, and most analysts believe that oil prices will not be materially affected by the king’s death in the long run.

Saudi Arabia’s long-held oil policy has been to keep the world’s markets well-supplied. Some called the rise in prices on Monday after the announcement of the king’s death “psychological” in nature.

The death of the Saudi Arabian king was not the only factor in Monday’s price hikes, with refinery problems in the United States causing more concerns that strong demands might not be able to be met.

Prices for West Texas Intermediate crude were up to $61.23 at one point during the day, but remained below the all-time high of $62.10, which was reached on July 7.

Saudi Arabian officials said on Wednesday that the Organization of Petroleum Exporting Countries will not be able to meet the projected Western demand for oil in 10 to 15 years.

Senior Saudi officials say that there will be an approximately 4.5 million barrel per day gap between needs and what Saudi Arabia will be able to supply.

According to the International Energy Agency, at current prices OPEC would have to boost production to 50 million barrels per day by 2020 to meet demand.

The cartel’s current production is around 30 million barrels per day.

Saudi Arabia possesses the largest oil reserves in the world and pumps 9.5 million barrels per day currently.

The kingdom says that it can reach 12.5 million barrels per day in 2009 and 15 million barrels per day eventually.

Western analysts say that it would be hard for Saudi Arabia to produce anything above that level.

Saudi Arabia is expected to have to shoulder half of OPEC’s production growth in the next 10 to 20 years, with most of the rest coming from the United Arab Emirates and Kuwait.

Meanwhile, European officials say they think the world could hold demand down to 44 million barrels per day if energy saving measures were instituted, a level of production they believe OPEC could handle.

The price of crude oil futures was up Thursday on the news that OPEC will only consider upping crude oil production quotas by 500,000 barrels per day if prices reach $60 per barrel.

OPEC also upped what it called the “ideal” price for West Texas Intermediate crude to $53 per barrel.

Last month, most OPEC ministers had named $40 to $50 per barrels as the ideal price range for both producers and consumers.

WTI contracts for August delivery were up 24 cents to $57.50 per barrel in early afternoon trading on the New York Mercantile Exchange, while at late afternoon in London, Brent crude on the International Petroleum Exchange had risen 32 cents to $56.47 per barrel.

July Nymex heating oil gained 4 cents to $1.6450 per gallon, while IPE July gasoil was up $13.50 to $526 per tonne.

These rises in distillate prices helped drive the gain in crude oil prices. Declines in price earlier in the week were attributed to profit-taking by oil traders.

In Russia, meanwhile, one of Vladimir Putin’s top aides, Igor Shuvalov, announced that Russia is determined to rise above a slowdown in oil output growth.

No time targets were offered, but Mr. Shuvalov expressed confidence that output could be increased by 7.5 percent to 10 million barrels per day.

The price of crude oil rose again on Monday amid continuing concerns about supply and the lack of refining capacity at refineries worldwide.

The fact that OPEC increased production quotas by 500,000 barrels per day when its members met last week seemed to have no influence on prices.

The OPEC president said that if prices keep rising through the end of the week, he would begin consideration of raising the quotas by yet another 500,000 barrels per day.

However, analysts said that this move would not do anything to stem price rises because there would be no additional refining capacity to handle the extra crude oil.

West Texas Intermediate July contracts rose 58 cents to $59.05 per barrel after advancing to $59.23 for a time in Asian trade.

August WTI was up to $60 per barrel and later contracts were trading between $60 and $61 per barrel in New York.

Brent crude for August was up 59 cents to $58.35 per barrel.

While promising to address the high cost of oil at its meeting in Vienna on June 15, OPEC has raised the price of its oil to the highest level in a year.

The change in prices was hardly noticed because prices on the New York and London futures markets stayed at almost the same level where they have been trading.

But several of OPEC’s Middle East members, led by Saudi Arabia, increased the price of their oil to US and European refineries and traders by cutting in half the discounts to futures prices they have been giving to those buyers.

This has sent the cost of a barrel of oil from the Middle East from $37 per barrel last October to $50 per barrel currently.

Some OPEC delegates as well as some analysts have justified the cut in the discount by citing rising fuel oil prices as well as rising crude oil inventories in the US, Europe, and Asia, which OPEC sees as a threat to its control of the markets.

The impact to Europe of the cuts in discounts is being exacerbated by the decrease in the value of the euro.

News that King Fahd of Saudia Arabia, the world’s largest oil exporter since 1982, had been admitted to hospital for tests sent July crude oil futures higher on the New York Mercantile Exchange on Friday.

King Fahd was admitted Friday night Saudi time suffering from what was described as lung trouble. While the king, thought to be 85 years of age, has handed over the running of routine affairs to his half-brother, Crown Prince Abdullah, he still must give his consent for key decisions.

King Fahd is credited with the modernization of his kingdom and with strengthening his country’s alliance with the United States, especially after he asked for US troops to protect Saudi Arabia when Iraq invaded Kuwait in 1990.

Those ties have weakened since the 2001 terrorist attacks on the United States, as Saudi Arabia has come under criticism for tolerating Islamic radicalism.

On the news of the king’s hospitalization, July deliveries on Nymex went as high as $52.00 per barrel before closing 84 cents above Thursday’s close at $51.85 per barrel.

Gazprom, the Russian natural gas monopoly, has announced that the Russian government will increase its holdings in the company from 38 percent to 51 percent.

Russia will acquire the shares on the open market and will pay cash for them.

This move makes it unlikely that a planned merger between Gazprom and Rosneft, the state run oil company, would proceed as planned.

However, if the merger does not proceed, it is considered likely that Gazprom will try to acquire another Russian oil company, possibly Sibneft.

It is also likely that the move by the Russian government will result in an end to the ban on foreign ownership of Gazprom shares.

The economic ministry said that it would borrow from international banks to raise the cash for the transaction, but there was some speculation that the money might be raised by selling part of oil producer Yuganskneftegaz, recently acquired by Rosneft, to China.

That acquisition tripled Rosneft’s oil production but served to complicate matters involved in the merger with Gazprom.

China’s National Oil Corporation is said to be in the market for new oil sources.

All this news had Gazprom shares up 2.8 percent to Rbs76 in late trading in Moscow.

Comments from OPEC on Sunday that it would continue production at near-capacity despite growing US inventories sent crude oil prices lower on Monday.

West Texas Intermediate on the New York Mercantile Exchange was down 74 cents to $47.92 per barrel while IPE Brent for June delivery fell 70 cents to $47.98 per barrel.

The comments to reporters came from Sheikh Ahmad al-Fahd al-Sabah, who is both president of OPEC and the Kuwaiti oil minister, at a workshop in Kuwait.

He said that OPEC will continue to pump more than 30 million barrels per day, the highest levels in a quarter of a century. He also said that a price of $40 per barrel is acceptable to OPEC. That is several dollars below current prices.

36 of 59 analysts surveyed by Bloomberg News said they believe crude oil prices will decline further this week.

Emirates, the airline owned by the government of Dubai, has reported a rise in full-year profits of 49 percent, bringing its net profits to $637 million.

In that year the airline carried 12.5 million passengers, up 2.1 million from the previous year.

The chairman of Emirates called it the seventeenth consecutive profitable year. This was achieved despite higher fuel prices, stiff competition, and fallout from the Asian tsunami.

One board member called rising fuel prices the biggest threat to future profits. Fuel costs were 21 percent of operating costs in the year just reported, up from 14 percent the previous year.

These higher prices have caused Emirates to postpone plans to open direct routes from Dubai to San Francisco, Houston, and Chicago.

The airline insists that it has to cope with rising fuel costs just like any other airline and denies that it receives any subsidies from Dubai or the United Arab Emirates.

Emirates is also looking into the possibility of an IPO.

Oil prices were down on Thursday despite an unexpected drop in U.S. inventories of both crude oil and gasoline.

This was the first drop in crude oil prices in three sessions.

The U.S. energy department reported on Wednesday that oil stockpiles had fallen by 1.8 million barrels, an unexpected fall after ten weeks of increasing supplies.

The fall was explained in part by a decrease in imports and an increase in refinery runs. However, fears that energy prices are hurting global economic growth and less than positive reports from some top companies have cause the trend in lowering crude oil prices.

Another influence in the falling prices was a statement from the oil minister of Saudi Arabia, who said Thursday that his country could meet oil demands for decades to come with its 261 billion barrels of proven reserves and another 100 billion barrels of what he called probably and possible reserves.

He predicted that these reserves could last for over 100 years.

By late morning in London, Nymex June deliveries had lost 53 cents, to fall to $53.50 per barrel. Brent June deliveries were down 39 cents to $53.59 per barrel.

Crude oil futures fell for the sixth straight day on Monday, and several pieces of news were credited with a combined influence to cause the drop in prices.

First of all, OPEC said they will consider raising oil production next month in order to meet a projected upturn in demand in the third quarter of the year.

OPEC also intimated that it considers $50 per barrel to be a realistic top limit for crude oil prices because that seemed to be a level that would not damage growth.

However there was evidence Monday that the rise in energy prices is currently damaging industry on a global level.

UK producer price inflation data had input prices rising 1.8 percent on a month-to-month basis. More than half of this rise was blamed on the rise in oil prices.

Companies seem to be absorbing this increase rather than passing it on to consumers, as the output price had only risen 0.6 percent in the same period.

Another factor that influenced the drop in oil future prices was the news out of Nigeria that an oil workers’ strike set for Monday had been averted because the union had solved pending labor issues with oil companies and the government.