TEHRAN // Iran is producing just over 4 million barrels per day (bpd) of crude oil, the head of the state oil firm has been quoted as saying, contradicting a figure given by the country's Opec governor two days ago. Iran's representative to Opec, Mohammed Ali Khatibi, said on Thursday that the nation was pumping about 3.8 million bpd and was complying fully with its share of oil supply cuts.
But Seifollah Jashnsaz, the managing director of the National Iranian Oil Company (NIOC), said in comments carried by the official Irna news agency yesterday: "In view of Opec's production cut that went into effect at the beginning of November, Iran's current crude oil production stands between 4,050,000 and 4,080,000 bpd." It was not clear why the two officials gave different figures for the crude output of Iran, Opec's second-largest producer.
In his Dec 4 comments, Mr Khatibi said Iran had cut 199,000 bpd as required under Opec's October agreement to reduce supply by 1.5 million bpd. He said Iran was pumping about 4 million bpd before the October cut. Mr Khatibi's comments on compliance were at odds with industry estimates that Iran had met little of its pledge to reduce supply. Opec, the source of more than a third of the world's oil, meets in Algeria later this month to discuss how to halt oil's price fall of more than $100 from its July peak of more than $147 a barrel as a global financial crisis hit energy demand in consumer nations.
Gholamhossein Nozari, the Iranian oil minister, said a week ago that the oil market was oversupplied by about 2 million bpd. The Opec ministers meeting in Cairo eight days ago deferred a decision on a new oil supply cut amid signs that Saudi Arabia and its Gulf allies were demanding tighter adherence with previous restraints. Delegates in Cairo flagged Iran and Venezuela, who have both urged deeper Opec cuts, as sources of concern on quota compliance.
In Saturday's Irna report, Mr Jashnsaz did not mention any figures about Iranian output cuts, but said Iran's oil production capacity had reached 4.23 million bpd and expressed hope it would rise to 4.3 million by March of next year. Iran's crude oil export revenue so far in the 2008-2009 financial year stood at US$61 billion (Dh224.05bn), he said. Echoing comments by another Nico official this week, Mr Jashnsaz said Iran would need about $160 billion for development projects within its oil and gas sector, saying it would have to rely on both domestic and foreign investment.
Abdolmohammad Delparish, the NIOC director of planning, told a seminar on Thursday that Iran needed investment of that magnitude in the next five years in its oil and gas industry. Iran is the world's fourth largest oil producer, but despite sitting on the world's second-biggest gas reserves it has yet to become a significant gas exporter. Analysts say western companies in particular are increasingly wary of investing in Iran due to tightening US and UN sanctions over its disputed nuclear programme. Asian countries have been more willing to sign contracts with Iran.
"We are planning to hold meetings both inside and outside the country, and invite investors," Mr Jashnsaz said. Mr Khatibi, speaking to the Isna news agency yesterday, warned of bottlenecks in global oil supplies due to lack of investment in the sector, saying this could lead to a leap in crude prices. * Reuters