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27 Sep, 2016 12:49

Iran not ready to freeze oil output with other producers at Algeria meeting

Iran not ready to freeze oil output with other producers at Algeria meeting

Tehran says it will continue increasing oil output until it produces four million barrels a day. Iranian Oil Minister Bijan Namdar Zanganeh told Bloomberg he is visiting Algeria to attend the International Energy Forum, and not to participate in a production cap deal.

“It’s not our agenda to reach agreement in these two days. We are here for the IEF and to have a consultative informal meeting in OPEC to exchange views. Not more,” Zanganeh told the media.

Iran is OPEC’s third-largest producer with daily output of 3.6 million barrels in August.

Algerian Energy Minister Noureddine Bouterfa said the meeting on the sidelines of the forum could become official since other OPEC members will be present, including Iran.

Last week, Iran declined a suggestion from Saudi Arabia to freeze production at January levels if Tehran agreed to do the same.

Zanganeh added that Iran wants to get back its 13 percent pre-sanctions share in OPEC production. The cartel pumped 33.7 million barrels per day last month, meaning Iran’s share should be 4.4 million. However, he didn’t rule out a formal agreement during OPEC’s official November meeting in Vienna.

Speaking to reporters on Tuesday, Saudi Arabian Energy Minister Khalid al-Falih said the kingdom is also regarding the meeting as consultative and sees it as a first step to future rapprochement.

“This is a consultative meeting, as said by many of my colleagues. We will consult with everyone else, we will hear the views, we will hear the secretariat of OPEC and also hear from consumers today,” said Falih.

Oil producers are seeking ways of eliminating the one million barrel per day glut that is weighing down crude prices.

Russian Energy Minister Aleksandr Novak said on Tuesday the production freeze is negotiable, but Moscow wants to cap production at the current level. Russian Deputy Oil Minister Kirill Molodtsov said last week that output in the country had exceeded the all-time high of 11 million barrels per day.

Oil prices lost over a dollar on Tuesday, with Brent crude trading at $46.10 per barrel, while US benchmark WTI cost $44.69, as of 2:30pm GMT.