In placing blame for rising oil prices, the war in Iraq has been high on the list, but energy executives and investors polled at RBC Capital Markets' North American energy and power conference recently point to an additional culprit-the increasing demand for energy in China. The poll queried 400 oil and gas executives and institutional investors, representing at least 70 of the largest U.S. energy firms. Nearly half (43%) polled believe China's need for energy is the main reason for higher oil prices. "Chinese demand is going to keep energy prices high for the foreseeable future," says Kurt Hallead, an energy analyst for RBC Capital Markets. "But, I think the results of the poll show that attendees are feeling that this issue and the resulting high energy prices will not kill the global economy. The increasing energy demand around the world is providing the potential for more predictable growth, which should translate into premium valuations for energy companies." Those polled also cited terrorism as an ongoing concern for the industry: 55% of respondents believe "an attack leading to a serious disruption in oil supplies is inevitable or likely this year," RBC reports. They also believe E&P and oil-service companies hold the greatest investment opportunity during the next year, and Russia, West Africa, the Middle East and Libya offer the greatest incremental opportunity for oil production. As for Iraq, nearly 80% of respondents anticipate 2006 is the soonest the country will be safe enough to produce oil in substantial amounts. Most of the respondents also believe energy prices have peaked and will remain high. They also anticipate the average price for gasoline will remain at today's prices; a barrel of oil will be worth $35.80 by year's end; natural gas will hit $6.20 per thousand cubic feet by year-end, and dip to $6.10 by 2005; and the Oil Service Index will end 2004 at 106.2 and finish 2005 at 115.6. In RBC's 2003 poll, executives named natural gas supply as the biggest issue facing the energy sector. While it remains an issue, those polled said it is not as detrimental to industrial demand as it once was.