Zanganeh to Veto OPEC Decisions Against Iran

Oil Minister Bijan Namdar Zanganeh on Thursday said he would veto any OPEC deal that imperils Iran's oil market share, after the organization's talks with Russia and other partners to institutionalize their supply management accord beyond this year.

The minister, who announced on Tuesday that he would not be attending this weekend's OPEC/Non-OPEC Monitoring Committee meeting in Algiers, criticized members of the bloc for saying they intend to boost production to offset barrels shut in by US sanctions on Iran, World Oil reported.

OPEC agreements require a unanimous vote by the 15-country membership, according to its charter.

"I will definitely veto any decision that threatens our national interest," Zanganeh said in an interview in his office with reporters from S&P Global Platts and Bloomberg News.

"Anyone who says they will compensate for the shortfall in the market is speaking against Iran. This is a 100% political statement, not economic."

OPEC, Russia and nine other non-OPEC partners on June 23 agreed to raise their collective production by 1 million bpd but have left unsettled how they will distribute the extra barrels.

Sunday's Algiers summit—the first formal meeting of the monitoring committee since the agreement—is intended to address the issue and OPEC sources have told Platts that the proceedings will expand to include more than 20 ministers from the coalition.

The group also aims to formalize their market management partnership, which expires at the yearend.

"They are sacrificing OPEC, they are destroying OPEC and slowly, slowly, without directly saying so, they want to gather some names together to create a forum to replace OPEC and manage the market," Zanganeh said.

The minister, who has maintained that OPEC members should stick to output quotas implemented in January 2017, said members who overproduce should admit to US pressure.

"If they want to produce excessively, we cannot stop them," the minister said. "There is no forcible instrument in OPEC. But they should not do it in the name of OPEC. They should come out and say, 'The US has phoned and told me to increase output. And I have no other way but to do so'."

US President Donald Trump has pressed OPEC—Saudi Arabia in particular—to pump more oil to keep prices from rising ahead of the US midterm elections on Nov. 6.

The kingdom, which is already pumping more than 400,000 bpd above what it produced in May, has said it will use its spare production capacity to keep the market well-supplied, as needed.