US says world could handle loss of Iran oil

By Tom Doggett

NEW YORK (Reuters) - Iran's dispute with the West over its nuclear program will probably not lead Tehran to cut off its oil exports, but if it did, the world could handle the lost supply, U.S. Energy Secretary Sam Bodman said on Tuesday.

The United States and other western countries are worried that Iran is trying to build an atomic bomb, even though Tehran insists its seeking nuclear power only to boost electricity supplies.

"I don't lose sleep over their (Iran's) withholding oil from the marketplace because they are so dependent on oil export revenues," Bodman said at the Reuters Global Energy Summit in New York.

The Energy Department told Congress last week that the 26 countries that belong to the International Energy Agency have enough government-controlled and private commercial oil stocks to cover a disruption in Iran's crude oil exports for more than four years.

Energy traders are concerned that if the United Nations punished Iran with sanctions, Tehran could try to hurt the Western economies by stopping some or all of its oil exports -- as Iraq used to do before the U.S. invasion in 2003.

"The big one everyone is worried about is some kind of showdown with Iran over the nuclear uranium reprocessing issue. The potential for that not only involves Iranian exports, but possibly spill over into other countries in the Middle East," said Adam Sieminski, chief energy economist for Deutsche Bank, who also spoke at the Reuters Energy Summit.

Worries over Iran helped crude prices hit a record over $75 a barrel last month.

Members of the United Nations Security Council were scheduled to meet on Wednesday to work out a joint plan to stop Iran from enriching uranium and to consider incentives proposed by European countries to convince Tehran to give up its nuclear program.  Continued...