• 35 mins Syrian Rebels Relinquish Control Of Major Gas Field
  • 2 hours Schlumberger Warns Of Moderating Investment In North America
  • 3 hours Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 4 hours Energy Regulators Look To Guard Grid From Cyberattacks
  • 5 hours Mexico Says OPEC Has Not Approached It For Deal Extension
  • 7 hours New Video Game Targets Oil Infrastructure
  • 8 hours Shell Restarts Bonny Light Exports
  • 9 hours Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 16 hours Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 21 hours British Utility Companies Brace For Major Reforms
  • 1 day Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 1 day Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 1 day Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 1 day OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 1 day London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 1 day Rosneft Signs $400M Deal With Kurdistan
  • 1 day Kinder Morgan Warns About Trans Mountain Delays
  • 2 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 2 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 2 days Russia, Saudis Team Up To Boost Fracking Tech
  • 2 days Conflicting News Spurs Doubt On Aramco IPO
  • 2 days Exxon Starts Production At New Refinery In Texas
  • 2 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 3 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 3 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 3 days China To Take 5% Of Rosneft’s Output In New Deal
  • 3 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 3 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 3 days VW Fails To Secure Critical Commodity For EVs
  • 3 days Enbridge Pipeline Expansion Finally Approved
  • 3 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 3 days OPEC Oil Deal Compliance Falls To 86%
  • 4 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 4 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 4 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 4 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 4 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 4 days Aramco Says No Plans To Shelve IPO
  • 7 days Trump Passes Iran Nuclear Deal Back to Congress
  • 7 days Texas Shutters More Coal-Fired Plants
China Takes Aim At The Petrodollar

China Takes Aim At The Petrodollar

In a potentially disrupting move…

Can Trump Drive A Wedge Between Saudi-Russian Alliance?

Can Trump Drive A Wedge Between Saudi-Russian Alliance?

Trump’s Iran deal decertification threatens…

Iran Denies Reports It Plans To Resume Oil Sales With Steep Discounts

Iran Denies Reports It Plans To Resume Oil Sales With Steep Discounts

Iran is dismissing a report that it plans to offer steep discounts on oil to many customers, particularly in Asia, when it returns to the global energy market sometime in 2016.

In an interview with Iran’s Islamic Republic News Agency (IRNA) on Sunday, Oil Minister Bijan Namdar Zangeneh said Iran plans to offer only what the agency described as “regular and customary” discounts that often are available to any potential customer.

Zangeneh was responding to a report by Reuters, based on anonymous sources in India, that Iran’s agents had changed its tactics in talks with prospective buyers. Rather than quoting their country’s own terms and prices for oil sales, they were asking potential buyers for suggestions about how Iran’s oil might be more competitive with that of its rivals.

Related: China's $1 Trillion Nuclear Plan

Iran’s standard offer for customers in India, the world's second-largest consumer of Iranian oil, is 90 days’ credit, free shipping and modest discounts on the oil itself.

“I haven’t seen [Iranian oil negotiators] as flexible as they were in the recent meeting,” said a source who works at an Indian refinery who met last week with S.M. Ghamsari, the international affairs director of the National Iranian Oil Co., according to the Reuters article.

”They have sought our feedback on how to make pricing of their crude competitive.”

The story also quoted four other sources at an Indian refinery as saying Ghamsari seem prepared to consider lower prices than usual, as well as offer new grades of crude oil, in an effort to boost Iran’s market share. “Naturally we will see if Iranian oil fits into our model,” Reuters quoted one source at an Indian refinery that doesn’t already buy Iranian oil. “If it is economical, only then we will go for it.”

Related: OPEC: $95 Oil, But Not Until 2040

None of this is true, however, Zangeneh insisted. Certainly, he said, Iran is eager to recover the market share it lost with the imposition of Western sanctions over its nuclear program, but not through cutthroat discounts.

“Iran’s oil exports will double if we increase the country’s production capacity by 1 million barrels,” Zangeneh said. “The sharp decline in oil prices will mostly harm countries which have collected Iran’s share in the market. … We need to regain our share in the market in order to avoid the need to ask OPEC countries to make room for Iran.”

Actually, for months Iran has been urging the cartel to cut production to do just that in order to prevent a further drop in oil prices, which have been on a steep decline since June 2014. But OPEC has steadfastly maintained and even exceeded its self-imposed output ceiling of 30 million barrels per day, and at its ministerial meeting on Dec. 4 dispensed with that ceiling altogether.

Related: Are Solar Panels Lifespans As Long As Industry Claims?

In July, Iran agreed to greatly limit its nuclear research in exchange for a lifting of sanctions after months of negotiations with Britain, China, France, Russia and the United States – the five permanent members of the United Nations Security Council – as well as Germany.

Yukiya Amano, the director general of the U.N.’s nuclear overseer, the International Atomic Energy Agency, said the organization should be able to very that Iran has complied with the terms of the agreement as early as the end of January 2016.

In his interview Sunday with IRNA, Zangeneh repeated Iran’s long-held belief that it could ramp up oil production by 500,000 barrels per day virtually as soon as the sanctions are lifted, and could double that increase “after a short while.”

By Andy Tully of Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment
  • DemocracyRules on December 29 2015 said:
    Andy Tully:
    Thanks for this article update. Perhaps another would help too. Questions unanswered include:

    - Multiple sources say that there is no agreement with Iran. Nothing was formally signed, and the pdf file of the White House version of the July 14 agreement is very loosely worded. It's not clear if Iran has actually agreed to anything in writing.

    - Iran has repeated many times since July 14 that they will not comply with the agreement. They have given many reasons for this. The worst sticking point is their demand that all sanctions must be lifted before they implement any part of the agreement.

    - Iran has now admitted to having worked on nuclear weapons for years. They have provided very little detail, and they will not agree to cease doing this work. One obvious problem is the their ongoing R&D work on making triggers for plutonium bombs.

    - Unless Iran stops all work on nuclear weapons, it would appear that some forms of sanctions, embargoes, and/or blockades from other countries will continue. For example, if Iran does get approval to export more petroleum, will the Saudis react by ramping up production to make oil even cheaper?

    It would be very valuable know anything you have about these and other related questions.

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News