Germany’s Deutsche Bank predicts that the average oil price will rise to $117 a barrel in 2011.

Oil prices will continue to rise with Saudi Arabia increasing its production to make up for the 1 million barrel-a-day (b/d) shortfall in Libyan production, says Henry Azzam, chairman of Deutsche Bank for the Middle East and North Africa region during the Arabian Hotel Investment Conference (AHIC) in Dubai.

Global markets are worried that the only countries with excess oil supply are Iran, Iraq, Venezuela and Nigeria, none of which are viewed as stable markets.

The International Monetary Fund last week predicted that oil would reach $107 a barrel this year.