OPEC should cut production by one million barrels per day (bpd) when it meets in Vienna on March 16 to counter the over supply on the market and increasing stock levels, Iraq's deputy oil minister Faiz Shahin said Sunday.
"Iraq is behind an OPEC reduction of one million bpd at its upcoming meeting," Shahin told the weekly Al-Ittihad newspaper. The cartel should cut output because of the market's saturation with both the onset of spring -- a season known for a drop in Western demand -- and at a time when consumer coountries' stock levels are already on the rise, Shahin said.
A barrel of Brent reference crude for April delivery was selling for $26.20 on Friday, while in New York, the light sweet crude March contract gained 39 cents to stand at $28.01 a barrel.
Prices have risen amid concerns that OPEC will squeeze its output when it meets in Vienna in response to the consumer market's slowing demand.
The cartel says it wants prices to stabilise at around $25 per barrel. But its basket price for seven world crudes slipped to $23.64 on Thursday from $23.81 on Wednesday, the cartel's OPECNA news agency reported Friday.
OPEC cut output by 1.5 million bpd -- five percent of its total production -- since February 1 in order to underpin prices. But consuming countries have urged restraint, fearing that further cutbacks will result in a new price spiral.
Iraq, which is not party to OPEC quotas, slashed its production from December following an argument with the United Nations over a new pricing formula as part of a campaign to end a decade of sanctions.—AFP.
©--Agence France Presse 2001.
© 2001 Mena Report (www.menareport.com )