OPEC ministers today decided to set a new production quota of 25.4 million barrels a day and to cut oil production by two million barrels. Speaking after the closely watched meeting of the world's major oil producing nations in Vienna today, Iran's oil minister Namdar Zangeneh said, "We've decided to reduce two million barrels a day from the first of June".
The move to cut production confirmed analysts' expectations, however the decision to raise quotas from June came as a surprise. Iraq did not participate in the meeting here aimed at stemming excess oil output but its potential as the world's second largest oil-producing nation was casting a shadow over the cartel. Iraq is excluded from the OPEC quota system due to sanctions imposed on the country in the wake of its 1990 invasion of Kuwait. But it has 112 billion barrels of proven oil reserves and was producing 2.5 million barrels per day under UN sanctions in 2000, only 300,000 below the peak it achieved before sanctions were slapped on the country in 1990, according to the International Energy Agency. ///www.fxcentre.com