Iranian Petroleum Ministry’s OPEC affairs head on Sunday ruled out the possibility of extra OPEC output and its impact on reduction of oil prices in the current uncertain conditions. In response to a question whether OPEC would hold an emergency meeting ahead of its extraordinary ministerial conference in Abu Dhabi on Dec. 5, Javad Yarjani said OPEC member states would meet in a summit in Riyadh in mid-Nov. and the issue would be discussed. Algerian Minister of Energy and Mines Chakib Khelil also ruled out the possibility of convening an extraordinary meeting of the Organization of Petroleum Exporting Countries before its Abu Dhabi conference. The Algerian Minister said in a press conference that OPEC would not hold an emergency meeting to curb soaring oil prices, which in recent days reached 90 dollars per barrel. Yarjani argued that low supply was not behind the increase in oil prices, adding the hike was caused by geopolitical issues. Khelil also said oil markets were reacting to geopolitical tensions and failed to react to recent OPEC production increase, which would be effective on the first day of next month. The Iranian official said those behind geopolitical crises were to blame for the growth of oil prices. “Some factors are historical,” opined Yarjani, noting that some limitations had been imposed on investment in oil-rich countries and some OPEC member countries had faced obstacles in the way of boosting their output. He also named downstream sector’s low capacity as another reason behind the price hike. “The depreciation of dollar and the rush of speculators for oil market are among main factors,” said Iran’s OPEC affairs chief, adding giant financial centers such as pension funds picked those markets that yielded more profits. “The upward march of oil prices, due to such non-trade activities, has been accelerated,” said Yarjani, adding, “In fact, brokers and speculators have sped up oil market’s developments. “Geopolitical developments including the crisis on Iraq-Turkey border have also played its role in increasing prices. Such political crises are usually imposed from outside the Middle East, a region that holds huge oil and gas reserves.” Shifting to consumer countries’ stockpiles, the official added demand for oil and consumption naturally grew in the fourth quarter of the year – cold season – and consequently stockpiles lowered. OPEC, however, decided to compensate for some part of the shortage and to lift its output as of Nov. 1.
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