Last Updated: Tue Nov 02, 2010 20:30 pm (KSA) 17:30 pm (GMT)

No need for OPEC output rise: Iraq oil minister

Shahristani came to Turkey to showcase Iraq's plans for a second round of oil contract tenders (File)
Shahristani came to Turkey to showcase Iraq's plans for a second round of oil contract tenders (File)

Iraqi Oil Minister Hussain al-Shahristani said on Monday he saw "absolutely no need" for OPEC to decide to raise oil production at its upcoming meeting next month.

Shahristani told Reuters in Istanbul that signs of global economic recovery would probably lead to increased oil demand in the near future, but at the same time crude reserves were higher now than they had been in the previous five years.

 In order to have a balance between supply and demand, we in OPEC don't want to drown the global market with crude that no one is buying 
Iraqi Oil Minister Hussain al-Shahristani

"We see absolutely no need for OPEC states to decide to raise production at the next meeting," Shahristani said on the sidelines of a meeting between Iraqi officials and executives from the oil industry.

"In order to have a balance between supply and demand, we in OPEC don't want to drown the global market with crude that no one is buying."

Shahristani, who came to Turkey to showcase Iraq's plans for a second round of oil contract tenders following a less-than-stellar first round in June, said oil production was still higher than global demand.

The Organization of Petroleum Countries (OPEC) meets on Sept. 9. The group had pledged over the past year to curb output by 4.2 million barrels per day to match the sharpest fall in demand since 1981.

Discipline slipping

 Some oil states are not abiding by the decisions or resolutions made by OPEC. This is not a positive sign 
Shahristani

Shahristani said discipline over the output cuts had been slipping.

"Some oil states are not abiding by the decisions or resolutions made by OPEC. This is not a positive sign," he said.

Asked if Iraq would demand greater discipline at the OPEC meeting, he said, "Sure, sure. We will insist on the necessity of displaying discipline."

Shokri Ghanem, chairman of Libya's National Oil Corp. and the country's most senior oil official, also said world oil demand had yet to show any sign of recovering and the market was oversupplied.

"Everybody should be urged to comply," Ghanem said.

"We are calling for compliance and should not, whenever we see the price is moving up, open the taps and produce more."

OPEC next meets to consider oil output policy on Sept. 9 in Vienna.

Although inventories are still high, the oil price has risen to almost $74 a barrel, more than double a low of $32.40 in December, which was the weakest in nearly five years.

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