Some of the world's biggest oil-producing countries have reduced their investment in new capacity despite record oil prices. The Organisation of Petroleum Exporting Countries this week revealed its members drilled 6.5 per cent fewer wells in 2003, suggesting the global supply crunch and high oil prices could last longer than expected, analysts said. The numbers appear to contradict statements by Opec members that they are actively building extra capacity.

"Oil demand has been booming since quarter one 2003, offering Opec - along with rising oil prices - a clear enough signal of tightening market conditions, which the organisation seems to disregard," the Centre for Global Energy Studies (CGES), a London-based consulting firm, said recently.