Page last updated at 16:08 GMT, Saturday, 15 November 2008

Iran pushes for further oil cut

Iranian oil field
Iran is one of Opec's 13 members

Iran is to urge the oil-exporters' group Opec to agree another cut in production to boost the price of oil, a top Iranian oil official has said.

It will call for a cut of between 1m and 1.5m barrels a day when Opec, which made a similar cut in October, meets in Cairo later this month.

The price of oil has fallen recently as demand declines amid the worsening global economic situation.

Iran, the world's fourth-largest oil producer, is viewed as a price hawk.

Iran's Opec governor, Mohammad Ali Khatibi, told Iranian state TV that talks were also under way with non-Opec crude oil producers to reduce output.

Achieving 'balance'

Members of Opec (the Organisation of Petroleum Exporting Countries), which supplies more than a third of the world's oil, needed a minimum price of $70-$100 a barrel, Mr Khatibi argued.

"If prices are lower we believe the global oil industry chain will be faced with problems," he said.

Opec is due to gather in the Egyptian capital on 29 November.

"It is better that, at the meeting in Cairo, it decides to cut output by another 1m to 1.5m barrels so that there is... balance between production and demand," Mr Khatibi was quoted as saying.

The Iranian official said negotiations with non-Opec producers, like Russia, were necessary because if they increased output, they would "neutralise" any reduction by the organisation.

"We believe they will also incur losses from the drop in oil prices therefore it is necessary that they will also cooperate and lower their output," he said.

Russia, the biggest non-Opec oil producer and second-largest oil exporter in the world, is struggling with a stock market crisis that has hit cash reserves built up on the back of an oil price boom.

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