Iran dismisses fears of export halt as OPEC keeps production

Venezuela and Libya, for their part, warned that the price of oil would rise even further if Tehran were referred to the United Nations Security Council over its controversial nuclear programme.

The Organisation of the Petroleum Exporting Countries decided to maintain its production ceiling of 28 million barrels a day at a meeting in Vienna.

The widely-expected move followed a 12.0-percent spike in the price of crude since the start of the year fuelled by controversy over Iran's nuclear ambitions and a series of attacks against oil installations in Nigeria.

Iranian Oil Minister Kazem Vaziri-Hamaneh offered reassuring words about his country's vital oil production.

"There is no link between the oil and the nuclear issue," he told reporters. "We have no reason to stop our exports."

The comments are likely to ease concern that possible sanctions against Iran, if its case is taken to the Security Council, could provoke retaliatory measures such as a cut in oil exports to industrialized countries.

OPEC president Edmund Daukoru said he was confident Iran, the world's fourth largest crude producer, would keep pumping as usual.

"I spoke with the Iranian minister and he assured me that on their own part they have never stated that they were going to shut production," Daukoru, who is also Nigeria's energy minister, told a news conference.

While emphasising the nuclear issue has nothing to do with OPEC, Daukoru warned: "If not well handled it could have repercussions" on the oil market.

OPEC is producing more than 29 million barrels per day including output from Iraq, which is not included in the official quota.

But its members have limited room to increase output so OPEC would struggle to compensate for any interruption in production from Iran. As a result, any concern about the Islamic republic pushes up the price of crude.

Earlier on Tuesday the five permanent UN Security Council members agreed to take Iran's case to New York over its disputed nuclear plans. The country could face sanctions as a result.

A referral is likely to come during an emergency meeting of the Vienna-based International Atomic Energy Agency, which begins on Thursday.

Washington accuses Tehran of using its nuclear programme as a cover for developing atomic weapons. Iran denies the claim.

Despite the drama, Qatar's Energy Minister Abullah bin Hamad al-Attiyah said the nuclear issue was not discussed at Tuesday's meeting.

Explaining its decision to keep the status quo, OPEC noted that prices remained high despite an ample supply of oil in the market.

It blamed this on "refining bottlenecks and other non-fundamental factors," according to a statement released by the cartel, which produces about 40 percent of the world's crude.

Analysts were disappointed by OPEC's statement.

"The OPEC decision is disappointing in that nothing has changed," said John Hall an analyst at John Hall Associates.

Venezuela's Ramirez, however, said there was a chance the cartel will trim output by between 500,000 and 1.0 million barrels per day when it meets again in Vienna on March 8.

Earlier this month, Iran spoke out in favour of a one-million barrel-per-day cut in the production ceiling, but the country did not propose a reduction at Tuesday's meeting, Vaziri-Hamaneh said.

World oil prices opened lower in New York after the OPEC meeting, with light sweet crude for delivery in March down 35 cents at 68.00 dollars per barrel.

OPEC groups Saudi Arabia, Iran, Venezuela, Kuwait, the United Arab Emirates, Iraq, Nigeria, Libya, Indonesia, Algeria and Qatar.

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