Iran backs OPEC output cut if market oversupplied

TEHRAN - Iran will back a cut in OPEC’s oil production at a meeting in May if the crude market is oversupplied, the country’s envoy to the cartel said on Tuesday.

By (AFP)

Published: Tue 21 Apr 2009, 2:57 PM

Last updated: Sun 5 Apr 2015, 10:12 PM

“If there is an oversupply, Iran will naturally support an output cut,” Mohammad Ali Khatibi told reporters on the sidelines of an oil and gas conference in Tehran.

“What is currently worrisome for OPEC is the fact that inventories are building up, some are stocking oil and products because future prices will be higher, and they are doing it to make a profit,” he said.

The next meeting of the Organisation of the Petroleum Exporting Countries (OPEC) is on May 28.

OPEC has reduced its oil production target by an overall 4.2 million barrels per day since September to 24.84 million bpd, the lowest since just after the US-led invasion of Iraq in 2003.

Iran’s Oil Minister Gholam Hossein Nozari said earlier this month that the OPEC cuts have helped stop prices from falling further in the past few months.

Iran, OPEC’s second largest crude producer, favours a global oil price of between 75 and 80 dollars a barrel.

Oil prices hit a peak of 147 dollars in July but have fluctuated this year between 40 and 55 dollars.

Prices were lower in Asian trade on Tuesday after a sharp drop in US share prices reignited fears about the slumping economy and its impact on energy demand.

New York’s main oil futures contract, light sweet crude for delivery in May, eased 44 cents to 45.44 dollars a barrel in afternoon trade.

Brent North Sea crude for June delivery dropped 31 cents to 49.55 dollars.

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