Organisation of Petroleum Exporting Countries (OPEC) has warned the world of another oil price escalation unless more is done to improve the oil market transparency and regulations.

Oil, it would be recalled, surged to $150 in July 2008 and the oil cartel said in a statement that the transaction for 2009 was heading towards that surge.

European Union (E.U.) corroborated OPEC's view stressing that the "last year's price bubble could be repeated unless more is done on oil market transparency and its regulations."

In an effort to encourage clarity, the E.U. agreed recently to publish monthly data on oil stocks.

E.U. energy commissioner Andris Piebalgs said that an overall effort to increase supervision in the global financial market will also be instrumental in reducing the impact of speculation in the oil market.

Meanwhile, the OPEC also said that it was revising downward its outlook for oil and energy to 2030, because the current economic downturn and new rules in consuming countries are expected to weigh on oil demand.

"The economic recession, together with new legislation and regulations in many consuming countries, had added to long-standing uncertainties about future demand and had led to downward revisions to the long-term oil and energy outlook to 2030," it said

The commodity at the weekend traded around $69 per barrel.

amid mixed signals about crude demand from a weekly United States (U.S) inventory report and a slight weakening of the U.S. dollar against the euro.

At midday in Europe, benchmark crude for August delivery was up 31 cents to $68.98 a barrel in electronic trading on the New York Mercantile Exchange. On Wednesday, it lost 57 cents to settle at $68.67.

Crude prices have fallen from an eight-month high near $73 earlier this month on investor doubts that demand in a weak U.S. economy may not justify the stock and commodity rally since March.

The Energy Department's Energy Information Administration reported Wednesday that U.S. oil supplies dropped more than expected last week, falling 3.8 million barrels, or 1.1 percent. However, gasoline in storage swelled 3.9 million barrels, which was more than expected, to 208.9 million barrels.

The U.S. central bank also struck a cautious tone in comments Wednesday.

The Federal Reserve said the economy doesn't appear to be sliding as quickly as it had been and consumer spending has shown signs of stabilizing. However, job losses, shrinking wealth and tight credit will likely keep economic activity weak for some time.

"Recovery in the U.S. is likely to be a gradual process," said David Moore, commodity strategist at Commonwealth Bank of Australia in Sydney. "So while there's some optimism that the worst is probably past, the upturn will possibly be slower than has been factored into the oil market."

JBC Energy in Vienna said the Fed's decision to maintain low interest rates could improve sentiment toward commodities.

"Although low rates are meant to stimulate borrowing, they could also fan inflationary fears and in turn boost investors' interest in commodities as an asset," JBC said.