Iraq's Oil Minister said on Monday current crude prices were fair and not too high to hinder global economic recovery, but added that he was not very happy with OPEC members' compliance with production quotas.
Hussain al-Shahristani said he was comfortable with current price levels which were high enough to encourage investments, adding that there was no need for an emergency OPEC meeting before October.
"The current price is also not too high to hinder the recovery of the global economy. It's a fair price," he told Reuters on the sidelines of the Asia Oil and Gas Conference (AOGC) in the Malaysian capital.
U.S. crude for July slid as much as $2.00 to $69.51 a barrel on Monday, the lowest since May 26, and was down $1.34 at $70.17 by 0804 GMT, extending Friday's drop of more than $3.00.
Oil's more than $20 plunge over three weeks last month, sparked by European debt problems, underscored market volatility from equities to commodities and the fragile state of global economic recovery, analysts said.
Al-Shahristani later said that fairer crude oil prices could be reached if members of OPEC better abided by production quotas.
"We have not been very happy with the compliance over the past few months. It's about 50 percent now," he told a news conference. "With better compliance, we should be able to reach a fairer price."
He also echoed the stand by the producer group that it had no plans for an early meeting before the next scheduled one on Oct. 14, though some members were voicing concerns about falling prices.
Libya said last month that OPEC members were talking informally about the drop in oil prices this month, and are urging each other to comply more closely with agreed supply targets.
Al-Shahristani said the right time to discuss Iraq's OPEC production quota will be three years from now when the country's output reaches 4.0 million bpd, adding it is now pumping 2.5 million bpd and will add 200,000-250,000 bpd next year.
Iraq's oil production capacity is projected at more than 12 million bpd by 2017, he said.
The impact of contracts awarded for rounds one and two of oilfield bidding in Iraq is expected to see more than 60 billion bpd of crude over 20 years, he said, adding that the country's oil supply will provide a safety valve that can help dampen price volatility.
However, Iraq will only produce what is needed and will not flood the market or influence prices in any way, Al-Shahristani said.
He added that the third bidding round for three Iraqi gas fields will open by September 1.