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Iran flip flops again on oil production hike, Iraq lone holdout

Special to World Tribune.com
MIDDLE EAST NEWSLINE
Friday, March 31, 2000

NICOSIA [MENL] -- One day after nine out of the 11 Organisation of Petroleum Exporting Countries member states agreed to increase oil production levels by 1.45 million barrels per day to a daily output of 21.069 bpd, Iran capitulated and agreed to the raise its output from April 1.

Iraq continued to oppose the OPEC decision in Vienna Tuesday to increase production levels.

Iran is the second largest producer within OPEC. Iran's new ouput levels under the agreement will be 3.623 million bpd, a rise of 265,000 bpd. Estimates of Iran's total output capacity vary between 3.7 million bpd and four million bpd.

Earlier, Iranian officials said sufficient oil was being produced to meet international demands. But on Wednesday, Iranian oil minister, Bijan Namdar, told Iranian radio, that "Iran definitely plans to increase production from 1 April." The amount depends "on the national interest and what the market dictates," he said.

Earlier this month, Iran agreed to higher production cuts in talks with lead producer Saudi Arabia, but then changed its position. At Vienna, Iran urged OPEC members to resist consumer pressure from the United States and Europe to raise crude oil supplies.

"The U.S. intervention was beyond expectations," Iran's OPEC governor Hossein Kazempour Ardebili said Tuesday. "There was a lot of resentment and a lot of resistance."

The price of crude oil fell sharply as markets in New York and London in reaction to the Iranian decision, dropping almost 4 percent to its lowest price in more than 2 months.

OPEC ministers have agreed to meet again in Vienna in June to review production policy.

In an unrelated development, the Teheran daily, Hammihan, published a color picture of the U.S. flag on its front page Wednesday, acceding to increasing public pressure to end more than 20 years of estrangement between the former allies.

Hammihan, which presents the viewpoints of both the hard-liners and reformers, carried pictures of the U.S. and Iranian flags above an editorial entitled, "Iran-U.S. ties: dark and bright aspects."

It was the first time in more than two decades that the U.S. flag, which the hard-line clergy has portrayed as a symbol of hatred since the 1979 Islamic revolution that ousted the U.S.-backed shah, was published with respect in a mainstream Iranian daily.

Friday, March 31, 2000


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