By Andy White
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The secretary general of oil cartel OPEC has warned that the Middle East faces “enough problems” without the threat of a US or Israeli strike on Iran.
“I sincerely hope no such [conflict] will take place,” Abdalla Salem El-Badri told Arabian Business. “That region has enough problems now. We should not create any new problems and obstacles.”
He warned that any attack would inevitably drive prices higher, although he did say that the cartel’s spare capacity would allow it to mitigate any future interruption to production.
“As we have seen in the past, if something happens which disrupts oil production and supplies, oil prices will inevitably be pushed higher,” he said. “[However] I would like to reiterate that I hope this is a situation which will never occur.
“There is no geopolitical premium attached to current oil prices,” he said. “OPEC currently has over six million barrels a day of spare capacity, which helps to ease any concerns about possible future disruptions.”
El-Badri also reiterated his stance that oil at less than $75 a barrel made future investments in exploration and development “less feasible”.
He added that the production compliance rate of the cartel’s members averaged 65 percent for the year 2009.
Read the full interview in Sunday’s Arabian Business magazine.
