Zanganeh sees more output cuts at next OPEC meeting
Iranian Oil Minister Bijan Namdar Zanganeh said on Monday that he expects further production decrease during the next meeting of the Organization of the Petroleum Exporting Countries (OPEC) in December.
“We expect the decline in oil production to increase further, which means that we will see a further cut by OPEC to the market,” Mehr News Agency quoted Zanganeh as saying.
Iran’s former OPEC governor said in June that the Islamic Republic’s demands were satisfied in the recent meeting of the OPEC.
Mohammad Ali Khatibi told IRIB that Iran insisted that no change should be made in the production ceiling and quota for OPEC members.
Fortunately, in the recent OPEC meeting in Vienna, Iran’s demand on OPEC quotas and production ceilings were mat, added Khatibi, who is also an oil industry expert.
Based on OPEC’s recent decision, countries that have produced less oil compared to others can increase production, the former envoy said.
OPEC agreed in June to raise oil production by around one million barrels per day (bpd) from July for the group and its allies.
The output gain is nominal. The real increase will be smaller because several countries that recently under-produced oil will struggle to return to full quotas while other producers will not be allowed to fill the gap, OPEC sources have said.
Saudi Arabia’s Energy Minister Khalid al-Falih said the agreement would allow countries with spare production capacity to boost output.
Zanganeh said in June that in practice, the deal added up to ‘less than 700,000 barrels per day’.
Zanganeh said the group reached a consensus to stick to the body’s output reduction agreement it struck in 2016 to cap production by 1.2 mbd after the 174th OPEC meeting.
“As I said on the minute of my arrival in Vienna, we needed to fully comply with the output reduction agreement of the organization and nothing more,” Zanganeh said.
“We agreed on this issue and nothing more. I think that the OPEC decision is acceptable and reasonable. It is also legal, because we have a valid resolution by the end of September,” the minister told reporters.
“I think only a few OPEC members are able to enhance their output. Some countries may be unable to fully deliver the agreed levels, but we have agreed on full compliance of the pact. As I had predicted, some member countries did not want to say anything against US interests or discuss de-politicization of the market. I already knew this.”