Opec has warned that the gas crisis could destabilize the oil market

(Bloomberg) -- As the global gas crisis hits suppliers consumers, Opec nations are warning of a ripple effect in the oil market.

Iraq expects demand for crude oil to increase as gas shortages force consumers to seek alternative fuels, Oil Minister Ihsan Abdul Jabbar said on Wednesday. Mele Kyari, head of the Nigerian National Petroleum Corporation, predicted oil demand could rise by 1 million barrels a day prices could rise by $10 a barrel in the next six months.

While the two exporters are neutral observers of the situation, their views echo a growing sentiment in the markets. Brent crude futures have reached $75 a barrel, close to their peak for the year.

Goldman Sachs says a cold winter could overwhelm the oil market's ability to make up for shortfalls in natural gas supplies, leading to a spike in oil prices that could have an impact on the economy. The bank said a mix of power generation industrial use could require nearly 2 million barrels of oil a day.

In such an extreme scenario, Opec its partners could benefit greatly, since they still had large supplies shut down during the outbreak last year. For Baghdad, this could be a particularly golden opportunity. After years of conflict, Baghdad is eager to maximize sales. "If there is an agreement within Opec, we will be ready," said Iraq's Jabbar.

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Source: International Gas Network