By Martin Morris
OPEC may agree further production cuts at its next meeting (May 28) if the market continues to remain oversupplied, Iran’s OPEC governor, Mohammad-Ali Khatibi, said on Tuesday.
He told Reuters that the main concern of OPEC member states at present is hoarding by consumer countries.
His claim comes after the International Energy Agency said last Friday that global oil demand this year will fall by 1 million barrels per day, due to the economic meltdown.
OPEC members have already agreed to reduce their output since September by about 4.2 million barrels per day or roughly 5 percent of world supply.
“We think that the 85 to 90 percent compliance with output cuts by OPEC members played a major role in stabilising the market,” Reuters reported as Khatabi saying.
He noted that Iran had reduced production as a result of OPEC decisions, but added that it disagreed with OPEC over the Islamic state’s degree of quota compliance. Khatibi declined to reveal the level of current output.
Meanwhile, US crude oil futures fell in mid-session trading Tuesday after Monday’s 8.8 percent slide in spot prices in response to suggestions that any US economic recovery is likely to prove weaker than expected.
However, losses were later clawed back after the American Petroleum Institute’s latest report showed a surprising 1 million-barrel drop in crude inventories over the past week.
Source: Arabianbusiness
