Iran Sees Balanced Short-Term Oil Supply & Demand.

Iranian Petroleum Minister Kazem Vaziri Hamaneh on Dec. 13 said supply and demand in the global oil market had become more or less balanced at the moment. His remarks were made at Imam Khomeini International Airport at night on Dec. 13 upon his return from Kuwait, where he attended the 138th OPEC ministerial meeting.

However, Minister Hamaneh was worried over the short term, saying: "Demand for oil could probably go down in the next few months causing a drop in oil prices". To avoid such a possibility, he said OPEC member states agreed to reduce their production quota in the first quarter of 2006.

Hamaneh said the oil ministers in Kuwait backed an OPEC basket price average of $50/b being "reasonable" and Iran also backed it. Hence, he said in the meeting it was agreed to maintain OPEC's agreed to a production ceiling of 28m b/d - excluding Iraq.

Hamaneh noted that the oil ministers to postpone election of the organisation's new secretary general to its Jan. 31 meeting. The 138th OPEC ministerial conference in Kuwait discussed the latest developments in the international oil market as well as the issue of OPEC's current production quota.

Norsk Hydro Makes Major Anaran Oil Find: Norsk Hydro of Norway has made a major oil discovery on its Anaran exploration block in western Iran, which could become one of the most significant oil finds over the past several years. The field was found as result of testing of an exploration well drilled on the Azar structure, which produced commercial quantities of crude oil in July 2005, Norsk Hydro said in a press release last week.

Exploration on the block continues with the Changuleh-West well currently in drilling. A commercialisation report has been submitted to the National Iranian Oil Company (NIOC). After its approval, Norsk Hydro and its Russian partner LUKoil will start negotiating a contract to develop the field. NIOC is expected to review the report by March 2006.

The contract covering the entry of LUKoil Overseas into the Anaran venture was signed on Feb. 14, 2003, and entered into force on Sept. 26, 2003 after NIOC's approval. The interest of LUKoil Overseas in the contract is 25%, with Norsk Hydro's stake being 75%. Four prospects, Azar, Changuleh-West, Dehloran and Musian, have been identified on the Anaran block. Projected recoverable oil reserves of the block could reach 1 billion barrels.

The mandatory work programme includes the drilling of five exploration wells. Executives at the Norwegian company say that, by 2010, Anaran could be producing up to 100,000 b/d.