LONDON (THE WALL STREET JOURNAL via Dow Jones Newswires), Jan. 2, 2009
Iran's OPEC governor said Thursday that a meeting before a scheduled March meeting could be a good option to assess the impact of the oil cartel's 4.2 million barrels a day of output cuts.
Muhammad Ali Khatibi also said Iran's average output for January would reflect a reduction of 545,000 barrels compared to September levels as part of the OPEC decisions.
"It could be useful if we can meet and review the performance of January," said Muhammad Ali Khatibi.
"If we meet in February, we can review the performance of the previous month," he said.
Chakib Khelil, who left the presidency of the Organization of Petroleum Exporting Countries Wednesday, has already said all OPEC countries may join a Kuwait meeting of Arab ministers.
Khatibi said: "No invitation has been received. If we do receive it, it will definitely be considered."
But he added that at the latest December meeting in Oran, Algeria, "OPEC agreed to a March meeting."
Khatibi also said that a cut of 545,000 barrels a day of Iranian output from September "will be reflected in January average production."
He said the reduction was part of a 4.2 million barrels a day cumulative reductions for all of OPEC. The official said 199,000 barrels a day has been reduced already in November and December. "It is not to difficult to cut exports" for Iran because sales are handled on a spot basis, he said, adding "this is one of the advantage of our exports."
Khatibi reiterated that one of the goals of OPEC cuts is to reduce the buildup of cheap oil stocks by industrialized nations. "In times of recession, logically, we should not supply the same amount to the market so the additional supply goes to stocks," he said.
Consuming nations "use the opportunity to buy crude at a cheap price to make a profit," Khatibi added.
He said the result was a rise - unacceptable to OPEC - to 56 or 57 days of inventories in industrialized countries. If oil supply is adjusted to what the market needs, "there will no stock buildup and the market will stabilize," he said.
He added "it should bring stocks to its 5 years average of 52 days."
Copyright (c) 2008 Dow Jones & Company, Inc.