Iran has said it supports in principle the freezing of oil production but stopped short of offering to limit its output in response to a Saudi and Russian proposal aimed at pushing up prices.
Iran has said it supports in principle the freezing of oil production but stopped short of offering to limit its output.
Trying to counter low prices, the two biggest oil producers – OPEC power Saudi Arabia and non-OPEC member Russia – have said they would freeze production, but only if other big oil nations did the same.
OPEC Gulf producers Qatar, Kuwait and the UAE, as well as Venezuela, have said they would join the pact. Iraq has also made sympathetic noises.
Iran argues it is a special case having lost market share during years of international sanctions.
Speaking after a meeting on Wednesday in Tehran with his counterparts from Iraq, Qatar and Venezuela, Iranian Oil Minister Bijan Namdar Zanganeh said: “This is the first step and other steps should also be taken. This cooperation between OPEC and non-OPEC members to stabilise the market is good news. We support any effort to stabilise the market and prices.”
Zanganeh chose his words carefully to avoid mentioning Iran’s position on freezing its own output.
“We had a good meeting today and the report of yesterday’s meeting was given to us. We support cooperation between OPEC and non-OPEC members.
“I was told that Russia as the world’s biggest oil producer, Oman and other countries are ready to join. This is a positive step, we have a positive approach to it, this is a good start,” he said.
Iranian officials are angry that while it was not able to export because of international sanctions other countries – particularly its regional rival Saudi Arabia – raised output pushing down prices.
Earlier Iran’s OPEC envoy, Mehdi Asali, told the Shargh daily newspaper: “Asking Iran to freeze its oil production level is illogical”
“How can they expect Iran to cooperate now and pay the price? We have repeatedly said that Iran will increase its crude output until reaching the pre-sanctions production level.”
LCG Market Analyst Ipek Ozkardeskaya said Iran is not willing to cut production having just started to increase it after sanctions were lifted: “I believe that Iran is going to be pushing and pressuring Saudi Arabia and continuing to do whatever it was planning to do before this whole setting got this dangerous. They are not going to be willing to leave the game before they start it.”
Some reports say Iran might be offered special terms as part of an output freeze deal, but it is unclear what those could be.
Crude oil prices did pick up on Wednesday, but Brent crude didn’t go much above $35 a barrel on Wednesday.