TEHRAN (FNA)- There is no need for OPEC to raise oil output as supply is already above demand, Iran’s new OPEC governor said on Thursday.
“Why increase? You can’t find a single consumer that comes to market and can’t find oil,” Mohammad Ali Khatibi told Reuters by telephone.
“The oil market is facing the problem of oversupply… yet the price has increased. That shows other factors are more important than fundamentals. OPEC is producing as much as it can.”
US oil hit a fresh record above $135 a barrel on Thursday. OPEC Secretary General Abdullah al-Badri on Thursday maintained the group’s stance that it can do nothing to lower oil prices in a “crazy” market.
Iran, the world’s fourth-largest oil exporter, has frequently said the market was not short of crude supply.
Consuming countries such as the United States have pushed the Organization of the Petroleum Exporting Countries to raise output to help tame prices. OPEC officials maintain prices are beyond their control.
Khatibi blamed oil’s rise on investment funds moving to oil from other markets and the weakness of the dollar.
“OPEC can’t do anything about that,” he said. “We can’t stop people in the United States bringing their money to the oil market.”
There was no reason for OPEC to meet before its next scheduled gathering in September as there was nothing for the group to discuss, he said.
Iran has yet to conclude a review of its oil output, he said. The review was routine, he added.
“It’s not finalized,” he said. “Any producer has the right to review its output policy and adopt that to the current market situation.”
He declined to say if the review would lead to any change in Iran’s output. Last week, a senior Iranian official said the country had no plans to cut oil exports.
Iran’s output hit 4.203 million barrels per day in March, the highest level since the 1979 Islamic revolution.
Crude had built up in supertankers off Iran’s shores because of maintenance at Iran’s onshore storage tanks and because some of the refiners that buy Iranian crude were doing seasonal work, Khatibi said.
The refiners had postponed the loading dates for their cargoes until after the work was completed, he said.
“They will come and lift later what they can’t lift now. This is mainly operational and it will be solved,” he said.
A shipping source said on Monday Iran has earmarked tankers with capacity for over 30 million barrels for temporary storage.
Khatibi said he did not have the latest figure for output, exports or oil in storage to hand.
Oil traders say much of the crude is heavy oil from the Soroush and Nowrouz fields that Tehran is struggling to market due to price and quality.
Khatibi said crude from Soroush and Nowrouz always went into to floating storage, as there was no other storage for the oil.
Iran announced Khatibi will replace the long-serving Hossein Kazempour Ardebili as governor to OPEC on Sunday.