This is called “the oil weapon”…
**Iran calls for oil output cut
**By Gareth Smyth and Najmeh Bozorgmehr in Tehran and Carola Hoyos in London
Published: January 20 2006 12:03 | Last updated: January 20 2006 20:21
http://news.ft.com/cms/8ffc73d4-448a-11d8-81c6-0820abe49a01.gifIran has called for a cut in global oil production while simultaneously preparing to shift its foreign assets out of Europe.
The moves were widely interpreted as a signal that Iran is preparing for a long stand-off with the west and sees oil production as a counter weight to international economic pressure.
Tehran’s call on Friday for the Organisation of the Petroleum Exporting Countries to reduce production by 1m barrels a day helped take prices up to a four-month high of more than $68 a barrel, even though Iran is the only Opec member to call for the cut and is unlikely to find much support for the measure at Opec’s meeting in Vienna on January 31.
Some traders said Iran’s comment was a sign that Tehran might be willing to use the threat of halting its substantial oil production as a political tool in its nuclear spat with the west. Iran is the fourth biggest oil exporter and main supplier to Japan, South Korea, France and Italy. The media in Iran this week has highlighted the upward pressure on oil prices simply through talk of sanctions.