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Iran Oil Minister Backs Extension of Crude Supply Cuts

Tehran will support a decision to extend an OPEC-led agreement to cut crude oil supplies and lift sagging prices if other members of the Organization of Petroleum Exporting Countries continue to comply with their planned cuts.

Iran Oil Minister Backs Extension of Crude Supply Cuts
(Wednesday, May 10, 2017) 21:32

Oil Minister Bijan Namdar Zanganeh made the statement in a press briefing on the sidelines of a meeting with the European Commissioner for Climate Action and Energy Miguel Arias Canete on Saturday in Tehran, Shana, the Oil Ministry news portal, reported.

Asked by reporters about the probability of extending the deal for six more months, Zanganeh said, "During the past few days, we received positive signals from OPEC and non-members, in particular Russia, about extending the agreement for the second half of 2017. We will back the agreement."

Zanganeh said that Saudi Arabia, Iraq and other members of the 13-nation organization have indicated their willingness to renew the deal in a meeting slated for May 25 in Vienna, according to Financial Tribune.

The Organization of the Petroleum Exporting Countries meets this month to discuss oil supply policy. Oil prices fell last week though they closed higher on Friday on growing hope that OPEC might agree to extend production cuts long enough to reduce a global crude glut.

Pointing to data released by OPEC's "secondary sources" about the country's oil output, the minister reiterated that Iran's crude production stands at 3.8 million barrels per day.

"Despite plans to increase production, Iran will stick to the level it has already accepted," the minister said.

"They (Iran) are not cutting, but they are not increasing output from what was agreed on and I think they will keep the same level if the deal is extended," Kuwaiti Oil Minister Issam Almarzooq said last week.

Saudi Energy Minister Khalid al-Falih said on Saturday there was consensus with Central Asia over oil markets and production levels.

Falih, who had arrived on a visit to Turkmenistan earlier and is on a tour of Central Asian nations, also tweeted there was agreement with the region on the necessity of sticking to production cuts.

  Oil, Gas Ventures

Denying speculations that the state-run National Iranian Oil Company will only collaborate with Russian and Asian oil giants to develop the country's hydrocarbon reserves, Zanganeh said, "Talks are underway with France's Total S.A.as well as Danish conglomerate Maersk Group, Germany's Wintershall and Austrian oil and gas company OMV."

On the prolonged process of signing the first oil development contract with multinational oil companies, he said foreign firms are approaching the final stretch of negotiations to develop the country's oil and gas fields and the NIOC has made significant progress in negotiations.

"It is very likely that Phase 11 of South Pars development project will be the first agreement to be finalized as the two sides are thrashing out details," Zanganeh noted, hoping that EU will support European firms willing to play a role in developing Iran's oil and gas industry.

Highlighting domestic ability and capacity to complete South Pars phases when international sanctions were in place, he said, "They (US) cannot stop us. No one can disrupt our activities for developing oil and gas but ... they can reduce the pace of our activities by putting political  pressure on international oil companies."

Under a landmark deal reached in 2015, Tehran agreed to curb its nuclear program in exchange for lifting of international sanctions tightened in 2012.

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