Iran blames dollar for crude problems

Nov. 15, 2010 at 9:30 AM
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TEHRAN, Nov. 15 (UPI) -- Iran believes the current market value for crude oil is based largely on a declining value of the U.S. dollar, Iran's governor to OPEC said.

The 12 members of the Organization of the Petroleum Exporting Countries decided to leave production levels unchanged during their October meeting in Vienna. The cartel said, however, that economic uncertainty was a cause for concern in the energy market.

The world demand for oil, OPEC said, has declined for two consecutive years, a market situation not seen in nearly 30 years. Meanwhile, the price for crude is on a "roller coaster ride" since the onset of the global recession.

Iranian OPEC Gov. Mohammad Ali Khatibi said current oil prices, around $86 per barrel, was in part a reflection of a declining dollar.

"In addition to prediction of dollar depreciation due to injecting money, it seems the U.S. intends to hold dollar weak in order to increase its exports and encourage investment while is involved in a kind of currency war," he told the Iranian Oil Ministry's Petroenergy Information Network.

World leaders during the Group of 20 summit in South Korea traded veiled barbs over currency issues as global economies struggle to gain momentum after the world-wide recession.

Iran took over the rotating OPEC presidency in October. Iran ranks third behind Saudi Arabia and Venezuela in crude oil reserves according to 2009 data from OPEC.

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