Iran's Oil Minister Says OPEC Prefers Stability to High Price
"High crude prices will clear the way for non-OPEC members to supply oil on the market. Consequently, the oil market will face unbridled oil supply from non-OPEC members which would, in turn, lead to a cut in demands and price slump," Zangeneh told IRNA after a meeting of the Organization of Petroleum Exporting Countries (OPEC) ministers in Vienna.
"In the status quo, the average OPEC basket price is said to be proper at $25 a barrel," he said.
Commenting on the plans adopted by Iran to develop its oil industry, Zangeneh said, "Iran intends to raise its oil output to five million barrels per day by the end of the Third Five-Year Economic Development Plan (launched in March 2000) from a current four million bpd."
He added that the National Iranian Oil Company (NIOC) is to finance the projects which would help to raise oil output.
"Given the oil market fluctuations, we have based our predictions on the $16 a barrel," he said.
Iran is the second-largest OPEC oil producer after Saudi Arabia.
The 11-member grouping left its output unchanged Tuesday despite Iraq's suspension of its exports, but agreed to meet again next month to review the situation.
The soothing sounds from OPEC calmed the markets: oil prices eased slightly on Tuesday in London where benchmark crude fell 18 cents to 29.08 dollars by late afternoon.
Analysts said the accord to meet again in July -- two months earlier than the next scheduled OPEC meeting in September -- was to demonstrate to the West that OPEC shares its concern about the risk of oil prices skyrocketing as they did last year, sparking fuel protests in Europe.
Iraq is not a member of OPEC's production quota system because of UN sanctions following its 1990 invasion of Kuwait.