OPEC should not reduce crude output above official quotas: Iran
Tehran (Platts)--25May2005
Iranian oil minister Bijan Zanganeh said Wednesday that OPEC needed to be careful with the amount of oil it was producing above official quotas but that the surplus output should not be reduced for the time being. The minister estimated that the ten OPEC members bound by a collective crude output ceiling of 27.5-mil b/d were currently exceeding their nominal limit by "much less than 1-mil b/d," and said there were no fundamental supply and demand problems in the world oil market. "OPEC cannot go back to its quota, if it could, it would be good, but at the moment it would not be good for the oil market to reduce our production," Zanganeh told Platts in Tehran. "Iran does not have any specific concerns but we have to be careful about overproduction at the moment," he added. "The oil market doesn't have any problem in terms of supply and demand of crude oil in 2005 but there are some technical issues and refinery issues in the world and particularly in the US," he said. OPEC ministers are due to meet Jun 15 in Vienna to decide whether or not to leave the 27.5-mil b/d ceiling unchanged for the time being. World crude prices have fallen by close to $10/bbl since their peak in early April, with NYMEX and IPE Brent crude futures both currently below $50/bbl. OPEC does not have a formal price target at the moment, but Zanganeh said he thought "an oil price of around $40/bbl is reasonable." Zanganeh's remarks follow calls from his Indonesian and Algerian counterparts in the last 24 hours for OPEC to leave its output ceiling unchanged at the Jun 15 talks. Saudi Arabian oil minister Ali Naimi said last week that Riyadh had made a "conscious" decision to allow global stocks to grow ahead of expected heavier demand later this year. Read more about OPEC in Platts Guide http://ww.platts.com/Oil/Resources/News%20Features/opec/index.xml
Copyright © 2005 - Platts
Please visit: www.platts.com
Their coverage of energy matters is extensive!!.