Oil Minister Bijan Namdar Zanganeh said Iran does not intend to call for an emergency meeting of the Organization of Petroleum Exporting Countries to discuss the continued plunge in oil prices, IRNA reported Monday.
"We have absolutely no such intention and are just consulting with our fellow OPEC members in a bid to prevent a long-term continuation of the sharp fall in oil price," Zanganeh stated, adding that these consultations have so far failed to bear fruit.
Cooperation among OPEC members should increase so that stability returns to the oil market, and for oil prices to stand at reasonable levels for both producers and investors, the Iranian official said. "This will pave the way for economical production of oil across the globe," Zanganeh asserted.
Asked whether Iran and Saudi Arabia have held any talks regarding the recent developments in the oil market, Zanganeh said that OPEC members have not had oil talks after the last meeting of the organization, which was held in Vienna back in November.
"For those who have any doubts on Iran's future plans for oil production, I can say that we are not going to cut our output any further," he asserted. Zanganeh said that political reasons are keeping oil prices from edging up, but he refused to blame any specific country for the price fall.
Saudi OK With Cheap Oil
Saudi Arabia can cope with low oil prices for "at least eight years", a former advisor to the kingdom's minister of petroleum said Monday. Mohammed al-Sabban told the BBC that Riyadh's policy was to defend its current market share by enduring low prices. "You need to allow prices to go as low as possible in order to see those marginal producers move out of the market," he said.
Saudi Arabia, OPEC's largest producer, has repeatedly said that it will not cut output to try to boost the oil price. Sabban said Saudi Arabia's "huge financial reserves" would enable it to cope with the low oil price.
Oil prices have more than halved since June. The dramatic fall has been blamed on a sharp increase in production from North American shale companies, which has increased the supply of oil and gas, helping to depress prices. Also undermining the price of oil are slowing global economic demand and a rising dollar against a range of other currencies.
On Monday, Brent crude was trading at around $49.40 a barrel, down 77 cents, and US crude was trading down 74 cents at $47.95 a barrel. The falls came after Saudi Arabia said again on Sunday that it would not cut output to prop up oil markets. Referring to countries outside of OPEC, Saudi oil minister Ali al-Naimi said: "If they want to cut production they are welcome. We are not going to cut, certainly Saudi Arabia is not going to cut."
Short-Lived Challenge
President Hassan Rouhani’s chief of staff has said that Iran will manage to overcome the challenge of plunging oil prices. "Iran's economy will be left unharmed by the recent developments in the global oil market because this challenge will be short-lived," Shana quoted Mohammad Nahavandian as saying Monday.
“"All economists confidently say that Iran’s economy will receive the least damage from the fall in oil price,” he said, adding that those countries that have caused the oil prices to fall will have their economies harmed both in the short run and the long run.
