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Iran Urges Lifting of Sanctions to Boost Oil Investment

World oil producers and consumers should work on removing sanctions and soothing Middle East security fears to boost investment in new production capacity, Iran's OPEC governor said on Friday.

Mohammad Ali Khatibi also told Reuters that he saw nothing that major powers who are meeting in Jeddah this weekend could do to soothe prices, which surged to a record near $140 this week.

"For the short-term we can't do anything. We have to focus on the long-term," he said in a telephone interview.

"Removing obstacles to investment would be a good way to boost extra capacity in the mid- and long-term, not just (by) removing sanctions on Iran ... but also removing problems caused by tensions, threats and intervention from outside countries in the region."

He added, "Many countries would like to invest in the region but the risk factor is very high due to tensions and war." Western sanctions against Iran, the world's fourth-largest producer, have stymied international investment in its vast oil and gas fields, which hold the world's second-largest reserves.

"The oil industry needs peace and stability to invest in production and refining ... If there is consensus to change the policy and behavior to bring peace to our region, then I'm sure that investors would come," he said.

Khatibi also said most countries did not have additional spare capacity to boost production, and that OPEC was already pumping 1.2 million barrels per day (bpd) above current consumption levels, meaning that there was no need to increase output.

Riyadh summoned world powers to Jeddah for an emergency meeting on Sunday in an effort to find ways of taming a rally that has seen oil prices soar almost seven-fold in six years, but the kingdom appears unlikely to orchestrate a hike in supplies from its peers in OPEC.

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