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Iran has been spared the economic troubles that other oil-producing countries have been facing with the low crude prices, as the government has managed to curb inflation and add billions of dollars to the country’s reserves, Iranian President Hassan Rouhani said on Wednesday, Iran’s Mehr News Agency reports.
Speaking to a crowd during an official trip in Iran, Rouhani said his government had been managing the economy with ‘relative ease’, while some of the wealthiest oil producers have had a tough road, with widening budget deficits and spending restrictions. He may have been referring to regional archrival Saudi Arabia, which has been struggling with high budget deficits, and has recently cut perks for government employees.
While Rouhani is traveling his country praising the government’s economic policy, his oil minister Bijan Zanganeh dashed hopes for an OPEC deal on output that would prop up the low crude prices. As OPEC members and non-OPEC producers are holding informal talks on the sidelines of the International Energy Forum in Algiers, Iran and Saudi Arabia remain too far apart in positions, and on Tuesday, Iran turned down the Saudi offer that it may be willing to cut if Iran freezes its output.
Iran has been pumping around 3.6 million barrels per day recently, but Zanganeh said yesterday it was not ready to freeze at these current levels and wants to go up to 4 million barrels per day. Iran claims it has the right to increase its production to reach pre-sanction levels.
“It is not the time for decision-making,” the minister has said.
Meanwhile, Saudi Energy Minister Khalid al-Falih said that although the positions of OPEC members are drawing closer, he does not expect today’s informal talks to lead to an agreement.
While smaller members may be pushing for and willing to reach some deal on intervention on the market, the decision once again hinges on old regional rivalries, and Iran’s comments seem to indicate that Iran is capable of holding out for a better deal—or a deal that never comes.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.