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Exempting Iran from OPEC Production Cut, Natural: Zangeneh

It would be natural for Iran, which is faced with US sanctions, to be excluded from any OPEC decision to cut the group’s oil output, Iranian Minister of Petroleum Bijan Zangeneh said.

Exempting Iran from OPEC Production Cut, Natural: Zangeneh
(Friday, December 14, 2018) 13:53
Speaking to reporters prior to 175th meeting of the Organization of the Petroleum Exporting Countries (OPEC) in Vienna on Thursday, the official said US sanctions on Iran were nothing new but “this is the first time for the president of the United States to instruct OPEC how to do [things]; and this is new and... I think this is not a good reaction inside OPEC. “

“We are a founder member of OPEC. We want to preserve OPEC, because this is the only organization where the third world has a little effect in the world economy, the official said.

Excluding Iran from Production Cuts, Natural

Asked whether Iran was planning to be excluded from any kind of deal that might be achieved by OPEC members, he said: “Yes, this is natural, otherwise it will be unnatural. It will be unnatural for Iran not to be exempted from any OPEC decision. “

Does Iran support an overall production cut for the group, asked one of the reporters. “We have no difficulty with it. It is related to the majority decision but Iran, until the lifting of all the sanctions, which are against Iran, does not join any agreement for cutting production because it is a special situation that Iran faces.“

OPEC, an Independent Organization

He said the US was going to dictate its policies and instruct OPEC had to do [things] and “they should know that OPEC is not part of the US Department of energy. OPEC is still an independent organization and is doing for maximizing the benefits of its members.”

Another reporter asked: “Are there any other members that are frustrated and feel the same as Iran?”

“Most of them have the same feeling, I think, but some OPEC members are going along the United States policies, unfortunately.”

Production Cuts?

“You said yesterday that the reasonable prices for oil would be $60 to $70 per barrel; what kind of cuts do you think the organization and its allies should make to achieve them,” asked another reporter.

“After this open session, we will have a closed session and we will receive a report on how to deal with this situation and I believe that OPEC is so mature to decide on the benefits of the majority of its members, said Zangeneh.

In response to another question about the surplus oil that should be removed from the market, he said, “There are different sums between 1.3 million barrels per day to 2.4 million barrels per day are the figures that are on the table would be discussed around these figures. These are results of reports that are on the table. This is not a matter of only logical figures. Finally, OPEC should decide about the figures which are acceptable for the majority of members.”

The price of oil would be better to stay between $60 a barrel to $70 per barrel, which is acceptable for most OPEC member countries, he added. “How much it has to be produced, it's a matter of the agenda of the closed session of OPEC meeting. “

He said all of Iran’s transactions were in non-dollar currencies. He also refrained from commenting on the sanctions.

“Nothing about the figures of Iran during the sanctions period. “

Oil Price in Iran Budget Bill

Another reporter asked Mr. Zangeneh about the Iranian budget bill and whether the Iranian government was able to balance the budget for the next Iranian year considering sanctions. He said: “Yes, the finished bill has been approved by the government and has been submitted to the Parliament.” According to Zangeneh, the price of oil was expected to be at $50/b in the budget.

Farewell to Qatar

Regarding Qatar's withdrawal from OPEC, said, “I sat with one of my good friends in OPEC and a close member of the organisation. I am sad to lose a close friend and a close member.”

“Is there any chance that Iran and Qatar could work more closely in South Pars?” asked another one; “No joint development but we should be closer to each other for the transfer of data and operate the fields by better information for the benefit of the two countries.”

“Do you share information now"? Yes, he said.

US Sanctions and Iran's Oil Exports

“I think that the US sanctions to Iran could create troubles in the world market. We believe that the global market should be depoliticized so that the consumers and producers could be the main beneficiaries of the market. You should cast a long-term view on these issues. In the long-run, a number of founding members of OPEC are subject to sanctions and this would certainly create supply shortages in the market in the future years.”

“We are discussing with European countries to find a way for receiving a revenues from oil exports and to buy our drugs and other commodities we need. It needs to be finalized; this relationship with the European Union has not been finalized. Experts in the ministry of foreign affairs and the European Union are discussing this. I believe that everything is in the hands of the European side not the Iranian side. We are going to receive positive signals from them.”

“Is Iran fine with the amount of oil it can export by the waivers provided by the US to Iran's old customers?” asked a reporter.

“No, we are not. We would be satisfied only when we could freely sell our oil without any pressure.”

“I think other OPEC members should understand our situation and I expect them to cooperate with us. This is the minimum cooperation. We would not accept anything else.”

“I think finally OPEC would achieve an agreement with Russia.... I think at the end of the story Russia will cooperate with OPEC, but it is just a matter of timing.”

“Are you for or against an overall production cut by OPEC?”

“I think OPEC is close to an agreement but I'm not sure before reaching the final decision. I cannot say that finally what we would do but it seems that they are close.”
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