Iran says OPEC will not boost output

By Hashem Kalantari

TEHRAN (Reuters) - Iran's oil minister rejected on Saturday any idea of OPEC raising production, saying it would fail to ease record prices as the market was already "saturated" with oil.

Gholamhossein Nozari also dismissed as a "political move" Saudi Arabia's announcement on Friday of a modest hike in output after an appeal from visiting U.S. President George W. Bush.

"No, the market is saturated with oil and a hike in production does not have an impact on the price," Nozari told reporters when asked whether the Organisation of Petroleum Exporting Countries (OPEC) would increase production.

Oil prices have risen six-fold since 2002 and doubled since last year as rising demand from China and other developing nations cinched spare production capacity, adding pressure on the U.S. economy already hard hit by a housing slump.

OPEC's smallest producer, Ecuador, said on Friday that members should consider raising output to stem the oil rally because high prices are hurting the poor.

But Iran, OPEC's second-largest producer after Saudi Arabia and a price hawk, says the market is well-supplied with oil and blames the price rise on a weak U.S. dollar, speculation and other factors outside the control of the 13-member cartel.

Oil shot to a record high near $128 a barrel on Friday as a bullish price forecast from investment bank Goldman Sachs drowned out the offer of more supply from Saudi Arabia.