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Iran Committed to Supply Cut Deal

Iran was the only country allowed to boost output under the OPEC agreement.Iran was the only country allowed to boost output under the OPEC agreement.

Iran is maintaining crude oil production within the framework of a global pact reached last year to cut supplies to ease the bloated oil inventories and lift sagging prices, a deputy at the National Iranian Oil Company said.

"We are raising (oil) production in compliance with the OPEC supply cut agreement," Gholamreza Manouchehri, NIOC's deputy for development and engineering affairs said, IRNA reported.

Members of the Organization of Petroleum Exporting Countries reached an agreement in Vienna last year to reduce collective output at a ceiling of 32.5 million barrels a day in the first half of 2017, with Saudi Arabia to shoulder nearly 40% of the burden. 

Non-OPEC members, including world's top producer Russia, also committed to the cause by promising to cut an additional 558,000 bpd.

Iran was the only country allowed to slightly boost output, while Nigeria and Libya were granted exemptions because of internal conflicts that have hampered their oil production. Under the deal, Tehran was allowed to boost output to 3.8 million barrels per day, around 90,000 bpd higher than its October production figure.

"As per the OPEC agreement, the 90,000-bpd rise in Iran's crude production is underway, Manouchehri said.

Tehran's crude output can exceed the 3.8-million-bpd mark on the condition that average daily production does not go over the ceiling for the first six months of the year.

Manouchehri pointed to discrepancies between government data on oil output and figures compiled by OPEC's "secondary sources", and denied reports that Iran is pumping above the agreed levels.

According to OPEC's latest monthly report that was published on Jan. 18, Iran pumped 3.720 million barrels per day of crude last month, 9,500 barrels a day higher than its Nov. output. Tehran did not submit its oil production figures for December.

From an average of 2.83 million bpd in 2015, output soared to 3.53 million bpd in the following year thanks to the lifting of international trade and financial restrictions against Iran last year that allowed it to diversify its market and sell significantly higher amounts of crude.

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