Oil market slump temporary, Iranian oil official says

The steep decline in oil prices is a momentary market phenomenon and does little to influence the economy long-term, an Iranian oil director said.

Iran this week said the decline in price for its grade of crude oil wasn't a parallel move to keep pace with Saudi Arabia's cuts designed to maintain its footprint in the global economy.

Rokneddin Javadi, managing director of the National Iranian Oil Co., said Iran wasn't bothered by an evolving bear market for oil.

"I think the oil market slump is momentary and does not affect Iran's budget for supplies," he said.

The price for the 12 crude oil blends that make up the reference basket from members of the Organization of Petroleum Exporting Countries, of which Iran is a member, was $85.14 for Wednesday, down from the $85.93 price for Tuesday.

An increase in oil production from North American shale deposits means market dynamics are skewed toward the supply side, pushing oil prices to historic lows. Some economies that depend on oil exports for revenue could start feeling the impacts, while producers elsewhere may find prices too low to sustain development.

The OPEC reference basket price was $105.75 in late July.

Iranian President Hassan Rouhani this week said the oil sector was the bright spot in an Iranian economy working to offset economic stagnation.

Iran under the terms of a multilateral nuclear agreement can export around 1 million barrels of oil per day, about half of what it exported before strict economic sanctions came into force in 2012.