Iran says OPEC oversupplying

At present, OPEC is believed to be producing about one million barrels more than its quota.

September 8, 2008 13:31 IST

Iranian Oil Minister Gholam Hossein Nozari said on Monday that OPEC was oversupplying the market as he arrived for a meeting of the cartel in Vienna.

“Of course there is an oversupply,” he said.

Iran has backed calls for greater compliance with OPEC production targets as a way of reducing output from the 13-member group.

At present, OPEC is believed to be producing about one million barrels more than its quota of 29.67 million barrels per day (bpd), with Saudi Arabia providing most of the extra oil.

“We will review the market and then decide,” said Nozari when asked about whether an official production cut would be approved at a policy meeting of the the Organisation of Petroleum Exporting Countries on Tuesday.

Analysts think the group will opt for greater quota compliance instead of an outright production cut. This would remove oil from the market but not amount to a potentially unpopular policy change.

Oil prices have fallen sharply from highs near USD 150 a barrel in July to slightly above USD 100.

This article was first uploaded on September eight, twenty eight, at thirty-one minutes past one in the afternoon.