Jan. 26 (Bloomberg) -- The International Energy Agency's chief economist, Fatih Birol, said current oil prices of more than $50 a barrel are too high, at about five times the average cost of production. The European Union's senior energy official, Andris Piebalgs, said he approved of the current prices.

``Prices are definitely too high,'' when the average cost of production is less than $10 a barrel, the IEA's Birol said today at a press conference in Davos, Switzerland, where he's attending the World Economic Forum. ``We want them closer to the cost of production.''

Piebalgs, the European Union Energy Commissioner, said at the press conference that he was ``happy with oil prices where they are now,'' because they are high enough to ``encourage alternatives'' to oil without crippling the economy.

Crude oil traded as high as $54.85 a barrel today in after- hours electronic trading on the New York Mercantile Exchange. It reached a record of $78.40 a barrel in July.

Shell Chief Executive Officer Jeroen van der Veer said at the same press conference the world needs a ``real international framework'' on limiting carbon dioxide emissions and said he would like to see the U.S. and other nations adopt an emissions-trading system similar to the European Union's.

To contact the reporter on this story: Stephen Voss in Davos, Switzerland at sev@bloomberg.net

Last Updated: January 26, 2007 04:37 EST