Iran is worried an output increase by some members of the Organization of Petroleum Exporting Countries is leading to oversupply, a top Iranian oil official said Tuesday.
Iran
is
worried an output increase by some members of the Organization of Petroleum
Exporting Countries is leading to oversupply, a top Iranian oil official said
Tuesday.
However, the official, from the country currently holding the OPEC presidency,
said nuclear shutdowns that followed
Japan
's earthquake
could support oil demand.
In an interview with Dow Jones Newswires, Iran OPEC governor Muhammad Ali
Khatibi said "there is some worry that oil exports from some countries
have increased."
He said a build up in crude oil inventories--with
U.S.
commercial
stocks rising by 3.2 million barrels in February--is "unusual" at
this time of year.
"There is more oil on the market than demand," the official said.
Despite the loss of much of
Libya
's
output by the end of last month, OPEC's production rose by 110,500 barrels a
day to 30.02 million barrels a day in February, the group said in its report
for that month. The organization uses secondary sources for the publication.
That is higher than demand the group expects for its crude this year of 29.8 million
barrels a day.
Some members such as
Kuwait
and
the
United Arab Emirates
have
continued a steady output increase that started last year.
But
Saudi Arabia
abruptly hiked its average production by 279,600 barrels a day in February,
making up for more than the average Libyan loss of 232,700 barrels a day, the
OPEC report showed.
The move has been described by other OPEC members as a way to respond to supply
concerns after civil war in
Libya
stopped exports there, instead of actual market demand.
Khatibi also said it was be too early for OPEC to examine its options after
allied bombing over the weekend led to fears the export interruption would
persist for months.
"First, the situation will [have to] be normal, then we can discuss how is
the damage, how they are going to repair," he said.
The Iranian official also said the earthquake in
Japan
could
lead to lower oil consumption in the very short term from the Asian nation. But
in the medium term, the country will need more oil and natural gas to make up
for lost power supply from shut down nuclear stations and also for its
reconstruction, he said.
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