OPEC: OIL'S TOO EXPENSIVE (Re-post)

Dr. Robert Mabro, a senior adviser to OPEC, thinks oil prices are "divorced from the fundamentals" of the market.

I'm always a little jolted to hear OPEC say oil prices are too high. But major oil producers, particularly Saudi Arabia, actually don't want prices to climb too quickly right now. That would squelch any chance at a global economic recovery.

It would also mean billions of dollars of wasted investment for many of those countries. Consider Iraq, for example, which is planning a major expansion of its Rumaila oil field (in a joint venture with BP and CNPC). The project would nearly triple Rumaila's production to about 2.8 million barrels per day. But if there isn't enough demand in the world market to soak up that excess oil, the investment is a waste.