Opec needs clarity, says Iran

DOHA/TEHRAN (Reuters) - OPEC cannot take effective steps to calm volatile markets without more clarity on the implications of regional instability for supply, Iran's OPEC governor said on Sunday, adding the market had enough oil. Fellow OPEC member Qatar also said on Sunday there was plenty of crude available from both OPEC and non-OPEC producers and that there was no justification for nervousness in the oil market. Concern about supply disruption from OPEC-member Libya, where revolt against its long-serving president has virtually halted exports, last week drove oil to a 2-1/2 year-high of nearly $120 a barrel. Prices eased to just above $112 on Friday after an industry source said Saudi Arabia had increased its output to more than 9 million barrels per day (bpd) following assurances from Riyadh that it would fill any supply gap. "Given the political instability in the Middle East and North Africa and the increase in international crude prices, conditions have been made very unstable for OPEC exporters and have made this organisation unable to take any measures," Mohammad Ali Khatibi said, according to the oil ministry website SHANA. "Any steps by OPEC member countries would require more stable conditions and precise statistics on the level of demand and stocks." In any case, the market was still "supplied with sufficient oil," he said. Iran, which needs a relatively high oil price to balance its budget, has typically sought a higher price than wealthy Gulf Arab producers. Saudi Arabia, in particular, is mindful of the need to preserve long-term demand for its vast reserves and to avoid destroying consumption with unsustainable price spikes. On Friday, after news seeped out of additional Saudi supplies, Iran said it would continue to comply with its OPEC output curbs. Saudi Arabia has said it was in talks with European refineries affected by the loss of Libyan crude, although it has also said the overall market was not short of oil. Speaking in Doha on Sunday, Qatar Energy Minister Mohammed Saleh al-Sada echoed that view. "We think there is no shortage of supply. Others (inside OPEC) and others outside of OPEC can make up for the loss in Libya," Sada told reporters. "As you can see there is no shortage of supply. The capacity is there and there is no reason for nervousness whatsoever." Qatar is one of the smallest oil producers in the Organization of the Petroleum Exporting Countries, pumping an estimated 0.8 million bpd, but it is the world's biggest exporter of liquefied natural gas. Libya also ships gas as well as oil. Reporters asked whether Qatar could supply extra natural gas if requested by European customers, especially Italy, which is very heavily dependent on N African supplies. "All the gas is sold, but we may consider some diversion in line with flexible contracts," Sada said.

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