Oil rates to rise on growing demand from India, China, Brazil

The growing demand of petroleum in countries like India, China and Brazil would be the major reason for increase in oil prices in the long term, US President Barack Obama has said.

In his remarks on economy in Florida, Obama said in the short-term instability in West Asia is the reason for its increase.

"The biggest thing that's causing the price of oil to rise right now is instability in West Asia -- this time in Iran. When uncertainty increases, speculative trading on Wall Street can drive up prices even more. So there are short-term factors at work here," Obama said.

"But over the long-term, the biggest reason oil prices will rise is growing demand in countries like China, India, and Brazil," he said.

"Just think in five years, the number of cars on the road in China more than tripled. Nearly 10 million were added in 2010 alone. Ten million cars in one year -- think about how much oil that requires. And those numbers will only get bigger over time," Obama argued.

Obama said the US consumes more than a fifth of the world's oil, but it has only 2% of the world's oil reserves.

"That means we can't just rely on fossil fuels from the last century. We can't just allow ourselves to be held hostage by the ups and downs of the world oil market. We have to keep developing new sources of energy," he said.