Iran: Freeze Production Agreement Fades away as Iran Increases Own

Hopes of an agreement between major oil producers to freeze production could be fading away after the Iranian oil minister Bijan Zanganeh said that exportation of the country’s oil and gas condensate has exceeded 2million barrels per day after daily production was increased by 250,000bpd in March.

His comments coupled with the interview of Saudi Deputy Crown Prince Mohammed bin Salman with Bloomberg, published on Friday, signal that a deal is unlikely to be reached during the next meeting on April 17 between OPEC members and non-OPEC members for a freeze on production based on the production levels of January 11.

Salman said Riaydh will only halt its production levels if all the other major producers, including Iran, make the same decision, warning that they will otherwise increase sales.

The warning cast doubts on the outcome of the upcoming meeting amidst reports that other OPEC members are boosting their production levels ahead of the talks.

Iran has unveiled plans to boost its production after the lifting of sanctions.

Semi-official Mehr News Agency reported on Sunday that Minister Zanganeh would only attend the talks “if he had time” but the oil ministry refuted the statement arguing that it was made during an interview on March 10 without clarifying if the minister will be present in Doha.

Kuwait’s acting oil minister Anas al-Saleh in March had stressed that a “common agreement on a positive stand will serve market stability” but also underlined that “I’ll go full power if there’s no agreement. Every barrel I produce, I’ll sell.”

The oil market is reportedly being supplied with more than 2milion bpd than the needed demand and reports of an agreement looming away would lead to a fall in oil prices after speculations of an agreement increased prices by 14% in March. With Iran aiming to increase its production capacity to 4million bpd, global oil prices could further slip.

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