Oil falls on Iranian production vow, rising dollar

oilNEW YORK: Oil prices continued to fall on Tuesday as the US dollar gained strength and an Iranian official reportedly said his country planned to boost output.

The development added to market sentiment that an informal meeting of OPEC producers together with Russia next month may not result in stronger prices.

In New York, a barrel of West Texas Intermediate for October delivery finished down 63 cents at $46.35.

On London’s Intercontinental Exchange, North Sea Brent also for October delivery fell 89 cents to $48.37.

Oil prices had rallied in August on hopes that Russia and the Organization of the Oil Exporting Countries could agree to limit production when they meet in Algiers on September 26-28.

Iran’s official Islamic Republic News Agency reported Tuesday that oil minister Bijan Zangeneh said that his country planned to increase production in order to regain market share lost while his country was under international sanctions.

Iran has struggled to raise production above four million barrels per day since the lifting of international sanctions earlier this year. The country is currently producing 3.8 million barrels per day, according to the report.

According to Bart Melek, head of Commodity Strategy at TD Securities, the Iranian remarks and the dollar’s value were driving the market.

“I think we are responding to a higher dollar…in addition to statements from Iran that they are unlikely to freeze production,” he told AFP.