Crude oil prices are too low, Iran’s President Ahmadinejad says

TEHRAN, Iran (AP) — Iran’s hard-line president declared that crude oil prices, now above $115 a barrel, are too low, state media reported Saturday.

President Mahmoud Ahmadinejad told an oil and gas exhibition in Tehran on Friday that he thought the commodity still had to “discover its real value,” according to the Web site of Iran’s state-run television.

Oil prices have hit all-time highs above $115 a barrel in recent weeks, amid reports that oil and gasoline reserves in the United States were lower than expected and as the dollar sinks to record lows.

“The oil price of $115 a barrel in today’s global markets is a deceiving figure. Oil is a strategic commodity that needs to discover its real value,” the Web site quoted Ahmadinejad as saying.

Crude oil futures surged to a new trading record of $117 a barrel Friday after an attack on a key pipeline in Nigeria.

The increase capped a week of record highs fueled by supply woes and the dollar’s weakness relative to other major currencies.

Ahmadinejad said despite high oil prices, the true value of crude oil, adjusted for inflation, is currently less than what it was in 1980.

“While the price of other commodities has increased, the economic value of the current oil price is even less than 1980,” he said.

But some figures suggest that today’s crude prices might have surpassed inflation-adjusted highs set in early 1980.

Depending on how the adjustment is calculated, $38 a barrel then would be worth $96 to $103 or more today.