Saudi crude hike 'won't change market'
Tehran, June 11, 2011
An increase in crude output by Saudi Arabia will not change market conditions as demand is for lighter oil than it provides, Iran's Opec governor was on Saturday quoted as saying, reiterating Tehran's stance that there is no need to boost production.
At a meeting in Vienna this week, Opec failed to agree on an increase in production, which consuming countries wanted and which leading exporter Saudi pushed for, because other producers, including Iran, said they feared prices could tumble.
Saudi Arabia will raise output to 10 million barrels per day in July from 8.8 million bpd in May, Saudi newspaper al-Hayat reported on Friday, as Riyadh proceeds outside official Opec policy.
Mohammad Ali Khatibi told the Iran newspaper that the three countries that supported an output increase - Saudi Arabia, Kuwait and the United Arab Emirates - had done so under US pressure.
'There is currently absolutely no shortage in the market, and consequently there is no need to raise production,' he said. 'Raising supply in the absence of demand would amount to an interference in the market flow.'
'These three countries can only raise the production of heavy and sour oils, while the market will only absorb increased production if it is of light category as there is no demand for heavy oil in the market.
'The absorption of heavy oil as feedstock by refining establishments would require a change in the refining mode and investment which is costly and time consuming and something which they won't do. They (the market) are awaiting the return of Libya's crude of (the) light category,' Khatibi said.
Iran, which holds the rotating presidency of Opec, has suggested holding an emergency meeting before the group is due to meet again in Vienna in December.-Reuters
More Energy, Oil & Gas Stories
- S Korea to pay Iran $550m under nuke deal
- Qatar LPG exports will stay unchanged till 2018
- $14bn Bahrain energy sector focus for summit
- Iraq now world's fastest-growing oil exporter
- Old IT systems pose risk to oil firms
- Thomson Reuters adds commodity monitoring tool
- Oil below $90 to hit GCC economies
- GlassPoint appoints new Oman director
- Sheffield company opens Dubai hub
- Oman targets big rise in gas output
- Intertek buys UAE firm for $66m
- Qaiwan to tender Baizan refinery EPC contract
- Al Maha wins Oman Air fuel supply deal
- Iran to become top gas importer by 2025
- UAE hydrocarbon projects seen hitting $11bn
- Summit focus on occupational safety
- Aramco names new senior VP
- Siemens gets $253m Qatar power contract
- Taqa-led group's India deal worth $1.6bn
- Taqa-led group to buy India power plants
- Iraq oil exports hit record 2.8m bpd
- Korean refiners eye more Iraq crude
- Dana starts Egypt gas plant upgrade
- Opec oil production hits new high in Feb
- Taqa-led group to buy Indian hydropower plants
- Schneider gets energy management certification
- Morocco moves ahead with $1.7bn wind farms
- Iraq approves power plant investments
- 670,000 oil & gas wells ‘need to be drilled’
- Qatar bourse celebrates Mesaieed listing