Iran can boost oil production capacity by at least 100,000 barrels within days if OPEC agrees to halt is output cut campaign to support oil prices, Oil Minister Bijan Namdar Zanganeh said according to Bloomberg.
Members of the Organization of Petroleum Exporting Countries and non-member countries led by Russia agreed to cut back daily oil production by 1.8 million barrels per day for oil inventories to drop to their five-year average in a bid to boost oil prices. The deal took effect from January last year and was extended twice to now run until the end of 2018.
Zanganeh said Iran could ramp up output within “five or six days” if OPEC at its next June meeting decides that crude prices are high enough to justify abandoning its oil-cuts accord with other producers, Bloomberg reported him saying to journalists in Tehran.
“We’re always adding to our production levels, from West Karoun and Azadegan,” Zanganeh said, referring to two oil-producing areas in western Iran near the Iraq border. Iran has so far exercised “self-restraint” in pumping to accommodate the group’s decision in November to maintain the cuts, Bloomberg quoted him as saying.
Brent crude, an international benchmark, has gained 48 percent since the producers first agreed to cap output. Brent is currently trading at US$67.76 a barrel.
OPEC allowed Iran, which is struggling to modernise its economy after years of international sanctions, to boost production slightly to 3.8 million barrels a day.
“If we want to make a decision, it has be at the right time, which is June -- when we’ll next meet,” Zanganeh said. “But my impression is that OPEC members are not after very expensive oil because very expensive oil leads to mid-term price fluctuations.”