OPEC meeting may debate accommodating Libyan crude: Iran

The next meeting of the Organization of Petroleum Exporting Countries may debate how to accommodate returning Libyan crude, a top Iranian oil official said.

The gathering due Dec. 14 in Vienna is widely expected to be more peaceful than an acrimonious June meeting. But the remarks underscore that it could see some lively debate on the implications of a faster-than-expected Libyan recovery for other producers. In an interview, Muhammad Ali Khatibi, OPEC's governor for Iran, said "accommodating Libyan production, it could be discussed among ministers at the next meeting." Iran holds the group's rotating presidency.
However, Khatibi said "we cannot expect all members to accommodate" returning Libyan crude since only some producers increased output to make up for lost Libyan barrels.
At the June meeting, a majority of members led by Iran refused to boost production citing economic uncertainty. But Saudi Arabia and other Persian Gulf nations still increased their production unilaterally due to a virtual shutdown of Libyan exports since March.
Following the toppling of Moammar Gadhafi, however, Libya has resumed production faster than expected, reaching 25% of its 1.6 million barrels a day output last week.
Nevertheless, Khatibi said "OPEC has a successful background" in adjusting its output following disruptions.
In addition, he dismissed fears oil prices could fall, suggesting the Libyan resumption could be offset by high seasonal demand.
"It seems that during the winter, the market fluctuates in this [recent] range" of $100 to $115 a barrel, he said, referring to the U.K. Brent contract.
Currently, "there is no absolute trend downward or upward," he added.
Source: Dow Jones