Iran says supports extending oil output cuts

Iran has indicated its support for extending a crucial oil output agreement by world’s biggest producers that helped stabilize prices in markets since its implementation early this year. 

Iran’s Oil Minister Bijan Zanganeh was quoted by the media as saying that most oil producers support an extension of the agreement which was devised by Saudi Arabia last year.

In December 2016, the Organization of the Petroleum Exporting Countries (OPEC) reached a landmark agreement with Russia and other non-members to proceed with the plan and slash oil production by nearly 1.8 million barrels a day for six months starting January 2017.

The agreement exempted key member Iran from the plan, allowing it to increase its production by 90,000 bpd to reach pre-sanction levels of around 4 million bpd.

Nigeria and Libya were also exempted from the planned output cut due to internal conflicts which have already decreased their crude production.

Zanganeh, in a press conference that was held in Iran’s energy hub of Assaluyeh, described as “historic” the cooperation between OPEC and non-OPEC producers over their output cut agreement.

He told reporters that the compliance by producers with the agreement had grown stronger “month by month”.

“The market has already taken the output cut plan seriously. This shows that the agreement between OPEC and non-OPEC producers has been successful,” the Iranian minister was quoted as saying by ISNA news agency.

He further stressed that he expected oil prices to remain around $55 per barrel as a result of the implementation of the output cut plan.

Zanganeh said he believed that most producers were inclined to see the plan extended, adding that Iran also supported this.

“Iran supports this decision,” he said. “If all producers continue complying with the output cut, Iran would also do the same.”