Oil prices edged lower on…
Amid record-high U.S. crude oil…
Iran will be capping its crude oil output at 3.8 million bpd in the second half of the year if fellow OPEC members stay committed to the cuts they had pledged, Iran’s Oil Minister Bijan Namdar Zanganeh said on Tuesday, as quoted by state news agency IRNA.
“If OPEC members stay committed to the agreement [on freezing output], Iran will produce 3.8 million BPD of oil in [the] second half of the current year,” Zanganeh said, as reported by Reuters.
OPEC decided to curb its total output by some 1.2 million bpd in the first half of this year, with the option to extend the supply-cut deal into the second half of 2017. In the November agreement, Iran was allowed to slightly raise its production and keep it capped at 3.797 million bpd between January and June, while other fellow OPEC members – except for exempt Libya and Nigeria – all had to cut their respective production.
Although the cartel is expected to decide on a possible extension in May, speculation is rampant whether the cuts should or would be extended and whether OPEC’s efforts are not all in vain, given the rise in U.S. shale output.
OPEC’s Monthly Oil Market Report released today shows that Iran’s output in February was 3.814 million bpd—an increase from the 3.778 million bpd production from January. So, Iran is basically keeping its end of the deal, and its oil minister’s words, so far.
Related: Will Nigeria Be Forced To Join The OPEC Production Cut?
Since most of the Western sanctions on Iran were lifted in January last year, the Islamic Republic has been trying to restore its crude output and exports to pre-sanction levels, and used this bargaining chip in obtaining a kind of leeway in the OPEC production cut deal. Most recently, Iran was said to have ousted Iraq from the no.2 spot of crude suppliers to India, behind Saudi Arabia.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com:
Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.