Energy
0

WSJ: Zanganeh Gaining Influence in OPEC

WSJ: Zanganeh Gaining Influence in OPECWSJ: Zanganeh Gaining Influence in OPEC

When a handful of OPEC countries floated a proposal to reintroduce production limits on members on Wednesday, it took only a few hours for Iran to quash the idea with the words of one man: Bijan Namdar Zanganeh.

By Thursday morning, support for the limits had faded and the Organization of Petroleum Exporting Countries took no action on production at its meeting, The Wall Street Journal reported.

Iran’s oil minister has taken on a more powerful role among the world’s biggest energy producers in recent months, as Tehran attempts an economic comeback with petroleum sales following the end of western sanctions in January.

Zanganeh, 63, has now broken up several attempts to reduce a flood of crude oil from both OPEC, which includes Iran, and non-members like Russia and the US.

The glut pushed oil prices to new lows over the winter, but Iran sees production-cap proposals as an effort to rein in its resurgent oil sales.

Zanganeh has his sights set on reordering the balance of power among the world’s biggest producers, especially with Saudi Arabia, Iran’s biggest rival and the de facto leader of OPEC, the 14-nation organization that controls over a third of the world’s oil.

 “Now Naimi is gone, [Zanganeh] is the most experienced” OPEC minister, said John Hall, chairman of UK consultancy Alfa Energy and a longtime observer of the group. Zanganeh “will push for maximum output. And the Saudis won’t compromise either.”

Zanganeh was appointed to his second stint as oil minister in 2013 and has mostly frustrated his Saudi counterparts, including a Saudi-backed plan last April to place new limits on oil production in an agreement with Russia. The proposal failed after Iran refused to join.

Zanganeh “has lots of advantages in OPEC, including Iran’s rising production and his experience”, said Jamie Webster, a fellow at the Center for Global Energy Policy at Columbia University.

Financialtribune.com