Iran may join other oil suppliers in freezing production after restoring its own output to levels before sanctions were imposed, Russian Energy Minister Alexander Novak said after meeting with the Persian Gulf nation’s oil minister.
Iran has “reasonable arguments” not to be constrained by the freeze for now, Novak told reporters Monday at the Russian embassy in Tehran. “Iran may join us in the freeze with time,” he said. “This is a normal, constructive position from our Iranian partners.”
Major oil producers are likely to meet in April to discuss a proposal to cap output at January levels in a bid to stabilize the market, Novak said, adding that he hopes Iran’s Oil Minister Bijan Zanganeh will participate. Qatar’s capital Doha is one option as a location for the talks, Novak said. “It is decided that a joint meeting of OPEC and non-OPEC producers will convene,” Zanganeh said, according to the Iranian Oil Ministry’s Shana news service, without saying if Iran will attend.
Iran is seeking to boost production by 1 MMbpd by June, the country’s Seda Weekly magazine reported, citing an interview with Amir Hossein Zamaninia, Iran’s deputy oil minister for commerce and international affairs. “The positions of Russia about Iran’s return as well as resumption of stability to the oil market were encouraging and very positive,” Zanganeh said, according to Shana.
Saudi Arabia, Russia, Venezuela and Qatar in February proposed an accord to cap oil output and reduce a worldwide surplus. Crude prices extended gains after their initial meeting on Feb. 16 and have climbed more than 40% since slumping to a 12-year low in January. Prices may have passed their lowest point as shrinking supplies outside the Organization of Petroleum Exporting Countries and disruptions inside the group erode global oversupply, the International Energy Agency said March 11.
Oil will probably end the year at $45 to $50/bbl, Novak told reporters. Brent crude was trading down 2.6% at $39.35/bbl at 3:17 p.m. on Monday in London.
Iran pumped 3 MMbopd in February, data compiled by Bloomberg show. It plans to boost crude output to 4 MMbpd, the highest level since 2008, Zanganeh said, according to the Iranian Students News Agency on Monday.
Saudi Oil Minister Ali al-Naimi said last month in Houston that the process of devising a freeze agreement would continue with more discussions in March. Nigerian Petroleum Minister Emmanuel Kachikwu said two weeks later that talks would convene in Russia on March 20. Russia’s Novak told state television channel Rossiya 24 on March 4 that a meeting could take place between March 20 and April 1 in Russia, Doha or Vienna, where OPEC has its headquarters.
So far no countries have received invitations or an agenda for a meeting, said four OPEC delegates, who asked not to be identified because the matter isn’t public.