Iran Promises Future Joint Action With OPEC

Iran Promises Future Joint Action With OPECIran Promises Future Joint Action With OPEC

Iran said it may be ready for joint action with other members of the Organization of Petroleum Exporting Countries in as little as one or two months, once it regains the market share it had before western sanctions were imposed over its nuclear program.

Iran, which refused to join other nations in a push to freeze output last month, could reach pre-sanctions export levels of 2.2 million barrels in one to two months or by the end of the summer, National Iranian Oil Company Managing Director Rokneddin Javadi said in Tehran, Bloomberg reported.

“If one day all OPEC members reach a decision to return to a quota system and operate on the basis of a collective policy, then we are ready and welcome” to participate in discussions on joint action, Javadi said.

The OPEC stopped setting production quotas for individual members in 2011 and abandoned an output ceiling entirely in December last year, sending oil prices to a 12-year low the following month.

Discussions to freeze production to boost prices were dropped last month after Saudi Arabia refused to join unless Iran was participating.

"Members will not discuss reestablishing output quotas when the group meets in June," Indonesia’s OPEC Governor Widhyawan Prawiraatmadja said last month.

There are currently no proposals to revive quotas for next month’s meeting after the failure of freeze talks last month, according to six delegates to the group.

Iran was the second-largest OPEC producer until Iraq overtook it in August 2012, following US and European Union sanctions over its nuclear program.

"Iranian oil is returning to the market quicker than expected," Neil Atkinson, the head of the International Energy Agency’s oil market division, said on Wednesday.

"The higher supply is being offset by lower production in Venezuela and Nigeria."

Brent crude, the global benchmark, has surged about 69% from the lows of January on slumping production in the US, disruptions in supply in some of the biggest producers and rising demand. Still, inventories continue to be high, especially in the US, the biggest oil user. Even though producers, including Royal Dutch Shell Plc, the world’s second-biggest oil company, expect global supply and demand to start balancing this year, they caution that existing stockpiles will keep prices in check.