July 1 (Bloomberg) -- OPEC oil producers face ``big uncertainties'' concerning future expectations of demand, potentially affecting some $500 billion worth of investment, the group's president said.

``We need to be assured of what to expect for future demand,'' Chakib Khelil, president of the Organization of Petroleum Exporting Countries, said today at the World Petroleum Congress in Madrid. ``There is a lot of uncertainty when it comes to decision-making about investing in upstream and downstream.''

Soaring oil prices have exacerbated concern among consumers about the security of supply and the ability of producers to meet their future needs. Conversely, oil exporters are wary of committing too much investment in case world demand fails to live up to forecasts.

OPEC pumps more than 40 percent of the world's oil and its biggest exporter, Saudi Arabia, controls most of the world's unused production capacity. Oil futures traded in New York touched a record $143.67 a barrel yesterday.

Prices are ``too high,'' Khelil, who is also Algeria's minister of energy, said today. On the weekend, he said prices could continue rising to $170.

Subprime, Dollar

Speculation by investment funds, the sub-prime mortgage market collapse and the weakness of the U.S. dollar are driving prices higher, he said. Concern about a possible attack on Iran and the ensuing disruption of supply is also boosting prices.

Khelil called on the U.S. to stabilize the dollar and open up more of its territory to oil exploration.

Investment funds ``are not the fundamental cause'' of high oil prices, they are following this tight market,'' BP Plc's Chief Economist Christof Ruhl said today in an interview in Madrid. `` Global oil demand growth has been slowing down'' and ``it will continue.''

The International Energy Agency, an adviser to 27 consuming nations, today lowered its forecasts for world oil demand during 2009 through 2012, and also cut its forecasts for non-OPEC supply and the need for OPEC oil.

To balance supply and demand, the world will require OPEC to pump 34.64 million barrels of crude a day in 2012, the IEA estimated in its annual ``Medium-Term Oil Market Report'' today. That's 1.54 million barrels a day less than it calculated a year ago.

May Output

Crude production from OPEC's 13 members was 32.3 million barrels a day in May, according to Bloomberg estimates.

OPEC's reference point is for global daily oil demand to reach 102.2 million barrels in 2020, leading to an expected need for 35.5 million barrels a day of OPEC crude by then, according to an OPEC background paper for a June 24 meeting in Brussels with European Union officials.

The amount of crude that OPEC will need to supply in 2020 ranges between 29 million barrels a day and 38 million barrels a day, however, and this 9 million barrel-a-day difference translates to an ``uncertainty gap for upstream investment needs in OPEC Member Countries of over $300 billion,'' the briefing paper said.

Speaking today in Madrid, Khelil said the range of OPEC's future investment needs were $230 billion to $500 billion, depending on how much oil is required.

To contact the reporters on this story: Ayesha Daya in Madrid at Adaya1@blomberg.netEduard Gismatullin in Madrid at egismatullin@bloomberg.net

Last Updated: July 1, 2008 12:51 EDT