Iran Predicts Further Increase in Crude Prices

The OPEC governor of Iran recently predicted crude oil prices throughout the globe will grow further because of different reasons such as foreign sanctions implemented on its oil.

In a report of the Mehr news agency, Mohammad Ali Khatibi said that under the present circumstances, oil prices will increase because of cold weather as well as the psychological effect of foreign restrictions forced on the exports of Iranian oil.

According to the Oil Ministry news service, Iran’s current amount of recoverable oil and natural gas supply amounts to  154.58 billion barrels and 33.69 trillion cubic meters respectively after discovering considerable quantities of the two types of oil over the previous year.

Based on the recent 2011 World Energy’s BP Statistical Review, the proven oil reserves of Iran’s gas condensate amounts to 137.0 billion barrels. In addition to this, the quantity of its natural gas totals at 29.6 trillion cubic meters as of the closing of 2010.

Shana, a website of the Oil Ministry of Iran, said that the statistics of the National Iranian Oil Company’s showed an additional quantity of recoverable gas condensates and crude oil amounting to 833 million barrels and recoverable natural gas reserves of 31.70 billion cubic feet or 897 million cubic meters since March of the previous year.

Those additions in reserves will not alter the ranking of Iran worldwide. It will still stay the third largest oil producer behind Venezuela and Saudi Arabia, second place for natural gas behind Russia.

Analysts of the oil industry have expected the output of Iranian oil to drop by almost 9% this present year to a daily average of about 3.3 million barrels.

In the meantime, oil prices rose more than $101 per barrel ahead of the crude supply numbers of the United States that will give indications regarding the demand strength in the largest economy worldwide.

In Europe, March delivery’s benchmark crude oil prices increased by 55 cents to reach $101.46 per barrel in the NYMEX. The contract grew further to $2.24 to close at $100.91.

In London’s ICE Futures Exchange, Brent crude prices rose by 13 cents to close at $118.06 per barrel.

Oil has floated within $100 for some months in the midst of signs that the economy of the United States is improving. But, the rise in crude supplies suggests that demand stays weak.

By Chris Termeer