Wed | Mar 21, 2018

Iran: No output freeze until pre-sanction output levels restored

Published:Friday | April 22, 2016 | 12:00 AM

Iran won't consider a production freeze until it reaches its pre-sanctions level of output of 4.2 million barrels a day, a senior energy official said on Thursday.

Mehdi Hosseini, who heads the oil contracts revision committee at Iran's Petroleum Ministry, said a freeze at anything less than that would be a continuation of the sanctions imposed on his country as a result of its disputed nuclear programme.

"Our pre-sanction production was something around 4.2 (million barrels per day), and our exports was something around 2.5, 2.6 (million barrels per day) or so" Hosseini said on the margins of an oil conference in Paris. "Therefore, any other figure less than that, means another sanction against ourselves. It is something we cannot accept."

The statement is in line with Iran's previous comments on the issue and comes after the country stayed away from a global producers' meeting last weekend on whether to freeze production.

With many international sanctions lifted under its nuclear deal with the United States and other world powers, Iran began exporting oil into the European market again and is eager to claw back market share. It produces 3.2 million barrels of oil a day now, with hopes of increasing this to four million by April 2017.

The failure of last weekend's meeting to yield any agreement dominated the conference's morning sessions, with one audience member asking whether the Organization of Petroleum Exporting Countries (OPEC), an economic alliance of oil producing nations, had become a "zombie organisation."

"I heard many times that OPEC was dead," OPEC Chairman Abdallah Salem el-Badri told participants. "OPEC will be around as long as there is oil in the ground."

Outside the venue, around 30 demonstrators shouted slogans against fossil fuels and climate change, chanting: "One, two, three degrees - it's a crime against humanity."

In the energy markets on Thursday, benchmark US crude oil fell US$1, or 2.3 per cent, to close at US$43.18 a barrel in New York after.

Brent crude, the international standard, dropped US$1.27, or 2.8 per cent, to close at US$44.53 a barrel in London.

In other energy trading, wholesale gasolene rose about a penny to close at US$1.52 a gallon. Heating oil fell three cents, or 2.4 per cent, close at US$1.30 a gallon. Natural gas was little changed at US$2.07 per 1,000 cubic feet.

- AP