Iran’s oil minister played down prospects of war and denied his country was losing oil income due to sanctions on its nuclear program, while blaming western nations for soaring international fuel prices.
Some oil-importing countries are using the commodity as a political weapon, Rostam Qasemi said today in an interview at the International Energy Forum in Kuwait. Those “unreasonable measures” will raise costs for governments pursuing them and bolster Iran’s oil revenue, he said.
U.S. Deputy Energy Secretary Daniel Poneman, speaking at the same venue, called on producers to pump more crude to help lower prices that are “too high.” Poneman and Qasemi attended a panel at the IEF to discuss ways to mitigate price volatility. The Iranian and U.S. delegations didn’t converse directly during the session, which took place under a marquee, according to three people who attended the session.
Brent crude has risen 17 percent this year amid supply concern as the U.S., the world’s biggest oil consumer, and the Europe Union tighten sanctions against Iran over its nuclear program. As much as 1 million barrels a day of Iranian exports may be lost because of the ban, the International Energy Agency said in a report today. The Islamic republic maintains that its atomic plans are for civilian use.
Oil as a Weapon
“We have never utilized oil as a political or military weapon or instrument,” Qasemi said in a Bloomberg Television interview at the executive lounge in the Regency Hotel, where the conference is held. “Those who have used a weapon in that manner, they will see the outcome of what they have done,” he said, without naming any specific country.
Representatives of the two rival nations, which broke diplomatic relations after Iran’s 1979 revolution and an ensuing hostage crisis at the American embassy in the Persian Gulf state, gave speeches on ways to mitigate crude-price volatility, according to the IEF agenda.
As much as 1 million barrels a day of Iranian exports may be lost as sanctions hamper buyers ability to pay and find transport for the crude, the International Energy Agency said in its monthly report released today. Qasemi said Iran would produce as much as the market needs and that the country hadn’t reduced its output or exports.
Brent crude for April settlement on the London-based ICE Futures Europe exchange traded at $126.21 a barrel, down 1 cent, as of 5:09 p.m. local time.
‘Prices are Good’
“The prices are good and we don’t think we will make less,” Qasemi said. “We think that at least we will have the income of last year. Our budgetary dependence on oil revenues has decreased significantly.”
Ali al-Naimi, Saudi Arabia’s oil minister, said the world’s largest crude exporter can make up for any shortage in global supply in an effort to assuage markets concerned that flows may be disrupted by a Middle East conflict.
“Saudi Arabia and others remain poised to make good any shortfall, perceived or real, in crude oil supply,” al-Naimi said, in a speech in the same session as Qasemi and Poneman.
The kingdom is set to pump about 9.8 million barrels a day this month, roughly in line with output in February, according to a person familiar with the state’s energy policy. The IEA, which said Saudi output reached 10 million barrels a day last month, forecast that the country’s crude could displace Iranian barrels as buyers cut back on purchases from that country.
“The world is large enough and it is full of customers,” Qasemi said, when asked what would happen to supplies previously sold to the EU.
During the formal meeting held in a tent set up outside the hotel’s conference room delegates sat in alphabetical order around a U-shaped table and speakers addressed the gathering from their seats.
Ministers and company executives from nations including Kuwait, Oman, Saudi Arabia and Japan sipped Arabic coffee and were served local sweets and dates by children in traditional dress as they passed through the lobby to the meeting area.
Poneman thanked Saudi Arabia and other suppliers for agreeing to make crude available to meet market needs, according to the people who heard his address. In comments to reporters afterwards, he said Iran’s pursuit of a nuclear program was at fault for market volatility.
“People need to comply with international nuclear non-proliferation norms,” Poneman said. “That is creating a tension in the region and the sooner we address those underlying issues the sooner I think calm will return to the market.”
The IEF, consisting of a group of nations that account for more than 90 percent of global oil and gas supply and demand, concludes its two-day gathering in Kuwait today.