A majority of OPEC's 13 oil ministers agreed to freeze production at current levels and allow war-damaged Kuwait to raise its output, but Iran rejected the accord on the grounds it would not boost world oil prices.
At the end of the two-day meeting OPEC Secretary-General Subroto said 12 of OPEC's 13 member nations agreed to keep production at the cartel's August level of 24.2 million barrels a day for the final quarter of the year.The pact also allowed for an increase in output by Kuwait, which was expected to bring overall OPEC production to 24.5 million barrels a day. Kuwait has been rebuilding its oil facilities, which were destroyed by Iraq when it invaded the emirate in August 1990.
OPEC's official production ceiling had been 22.98 million barrels a day since May, but the cartel has exceeded the official limit.
Subroto said that while no individual production quotas were set, members were urged "not to take any actions that could disrupt the stability of the market."
"We hope that the market will take this as a positive signal," he said.
But Iran refused to accept the agreement, contending it would not raise oil prices because it did not impose national output limits on the 13 OPEC states.
Iranian Oil Minister Gholamreza Aghazadeh dismissed the Organization of Petroleum Exporting Countries' final communique, saying "it was a press release, not a document to be signed."
"I do not accept the conclusions of this meeting because it would not affect prices positively," Aghazadeh said.
On the New York Mercantile Exchange, West Texas Intermediate - the key U.S. crude for immediate delivery - dropped 9 cents to $22.30 a barrel.
On the international spot market, where oil is sold to the highest bidder, the United Arab Emirates' Dubai light - the key OPEC crude from the Middle East - plummeted 32 cents to $18.52 a barrel.
The Iranian oil minister warned that "Iran will adjust production according to demand" and pointed out that his country has the capacity to pump 4 million barrels a day.
Nevertheless, Aghazadeh stressed Iran did not intend to destabilize markets by over-producing.
Despite its hardline stance, Iran is violating its OPEC quota of 3.18 million barrels a day. Iran told the OPEC Secretariat it produced 3.21 million barrels a day in August, but experts believe the figure is closer to 3.4 million barrels a day.
Iran, OPEC's second-largest producer, had insisted that OPEC lower its production to less than 24 million barrels a day and require each member to honor its output quota in order to drive up prices.