Iran says global oil market is oversupplied, no need for OPEC cut

Iran says global oil market is oversupplied, no need for OPEC cut

Tehran (Platts)--20Apr2006

Iran supports OPEC's current production ceiling of 28 million b/d
although the oil producing group is currently producing at full capacity, the
country's oil minister KazemVaziri Hamaneh said Thursday.
"We support the current OPEC production ceiling," the minister said when
asked about the possibility of the oil producing group raising its production
ceiling at its upcoming June 1 meeting in Caracas, Venezuela.
"OPEC is currently producing at full capacity," Hamaneh added. "At the
moment, the oil market is over supplied and there are no shortages. There is
enough oil in the market but the prices are still hiking and going upwards. It
is natural that any supplier is happy with higher prices."
The minister also attributed the higher crude prices to the gasoline
shortages in the US, but added that there was no need to cut OPEC's production
as it stands.
On Wednesday, a senior OPEC delegate said the producing grup does not
need to its 28 million b/d ceiling as things stand and there is no need for
the group to take any action to reduce production for the rest of the year.
But the global oil markets have been rattled, with IPE Brent and WTI
hitting all-time highs, by Iran's nuclear ambitions and recent comments by the
Islamic republics president, President Mahmoud Ahmadinejad, about oil prices.
Ahmadinejad said world oil prices have not yet reached their real values,
despite price increases in recent years, according to Iran's IRNA news agency,
as monitored by the BBC.
Stressing that international oil prices should be determined on the basis
of market supply and demand, Ahmadinejad said oil is the major asset of
nations possessing it.
Speaking at a joint cabinet meeting with provincial governors general at
the Ministry of Interior, Ahmadinejad said oil prices should not be lowered on
the "pretext that it will prove harmful to developing states, thus permitting
the world powers to benefit the most from it," IRNA reported.

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