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Iran oil sanctions damage world economy: Oil Minister

Source: Tehran Times

A looming oil embargo on Iran, will destabilize the global oil market and spark higher prices, Iranian Oil Minister Rostam Ghasemi warned Wednesday in Vienna. Sanctions imposed on Iran will damage the world economy and increase oil-price volatility, Bloomberg quoted Ghasemi as saying.

Iranian Oil Minister Rostam Qasemi (file photo)

"Sanctions ultimately will lead to a sharp swing in the price of oil," the minister said. He spoke at the International OPEC Seminar in Vienna, a day before the Organization of Petroleum Exporting Countries meets to determine output levels.

Crude exports from the country are the target of sanctions from the U.S. and a European Union ban on buying the country's oil takes full effect on July 1.

Related Article: Falling Oil Prices Prompt Russian Economic Fears

Ghasemi didn't comment in his speech on whether Iran seeks any change in OPEC's production target and declined to comment to reporters earlier in Vienna.

"Unfortunately the issue of imposing sanctions... is being considered by Europe," Ghasemi said on the eve of a meeting of the OPEC to discuss oil output levels, AFP reported.

"This politically-motivated approach will damage the stability of both the oil market and the world economy," he added.

"Unilaterally imposing sanctions as a means to attain a political objective are imposing constraints on the oil industry."

"This will result in an unstable oil market and ultimately lead to a sharp swing in the price of oil."

He added later however that "the time (for the embargo) has not arrived yet."

"We wish this will not happen. It will lead to higher prices."

The European Union is preparing to impose an oil embargo on Iran on July 1.

Iran's OPEC partners, gathered in Vienna for an oil conference ahead of their ministerial meeting, also spoke out against the pending EU sanctions Wednesday.

Iran is the second-biggest producer in the Organization of Petroleum Exporting Countries (OPEC).

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