Iranian OPEC Governor
Mohammad Ali Khatibi says oil prices between $70 and $90 per barrel are due to dollar devaluation and notes that an oil price of up to $100 would not hurt the global economy, Press TV reported.
Khatibi said that the world economy is in a position to absorb an oil price of $100, underlining that the oil companies find a price range of $70 to $90 suitable for investments in oil resources, the Oil Ministry news agency SHANA reported on Sunday.
"Not only producers, but also consumers have reached the agreement that $70 to $90 is a suitable price for oil because it encourages investment and at the same time does not hurt the global economy," he stated.
He went on to say that many experts believe that an increase in the price of oil up to $100 per barrel will not create problems for the market.
Khatibi added that dollar depreciation is one of the main reasons behind the fluctuations in oil prices.
Last week OPEC revised upward its world oil demand growth estimates for both 2010 and 2011, saying it was penciling in world oil demand growth of 1.32 million barrels per day (bpd), or 1.6 percent, to 85.78 million bpd for 2010, compared with 1.3 percent previously.
On Thursday, OPEC issued a report announcing that Iran's gasoline demand is falling while its exports to China and Japan are rising.
The report said China's crude imports from Iran jumped by 30% to 597,800 barrels a day in September. And the country's oil exports to Japan also increased 17% year-on-year to 367,000 barrels a day in September, making it the third-largest supplier of the East Asian nation.
The demand helped boost Iranian heavy crude prices by 7.4% in October, slightly outpacing a 7% average rise in OPEC oils.
At Friday's close, New York's main contract, light sweet crude for December, fell to 84.88 dollars a barrel, down 2.93 dollars from Thursday's closing level. London's Brent North Sea crude for December dropped 2.47 dollars to 86.34 dollars in London trade.
Earlier on Sunday, a report by the US Energy Information Administration indicated that crude exports by Iran, the world's fourth-largest oil exporter and OPEC's second-largest oil producer, stood at around $59 billion in the first 10 months of 2010.
Iran holds around 10 percent of world oil reserves. In 2009, Iran's revenue from oil exports reached $69.1 billion and it exported approximately 3.8 million barrels per day.
Last month, OPEC members elected Iran to hold the organization's presidency in 2011, a first for the Islamic Republic.