Iraq’s Dinar, Social and Economic – Investors Group

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UPDATE 1-Iraq oil minister sees possible oil oversupply
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WARSAW, Aug 21 (Reuters) - Oil supplies may be running slightly ahead of current world demand, Iraqi Oil Minister Hussain al-Shahristani said on Thursday.

"It seems for the time being what (oil) is being made available on the market meets the demand or even there is slightly more than demand," Shahristani told reporters.

Shahristani would not say if the situation meant OPEC needed to cut output at its September meeting, saying the group would have to first review its market data.

Some OPEC ministers have said the group may have to cut oil production if oil prices continue to fall. Oil prices have tumbled by more than $30 a barrel over the past month after hitting a record over $147 a barrel on July 11.

OPEC ministers meet in Vienna on Sept. 9 to discuss output policy. Iraq does not participate in OPEC's production quota system.

Shahristani made his remarks after talks with officials from Poland's economy ministry and representatives of Polish energy firms.

CHINA DEAL

Shahristani said he expected to travel to China next week to sign a $1.2 billion oil service contract, confirming a report earlier this week in Iraq's al-Noor newspaper.

The service contract, which replaces a previous contract awarded under the regime of Saddam Hussein, covers a small field that currently produces just 90,000 barrels per day (bpd) but would be the first international oil deal since Saddam's fall.

Foreign oil companies are keen to get access to Iraq's vast and largely untapped oil reserves, but high world prices are allowing Baghdad to drive a hard bargain.

Iraq hopes to boost oil production to 4.5 million bpd by 2013 and 6 million bpd by 2018, Shahristani said.

(Reporting by Chris Borowski in Warsaw; Writing by Robert Campbell in New York; Editing by Christian Wiessner) Keywords: IRAQ OIL/ [e-mail] ms1
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