Zanganeh Calls for Extraordinary OPEC Meeting Over Production Changes

EghtesadOnline: Iran's Oil Minister Bijan Namdar Zanganeh said OPEC may need to hold an extraordinary meeting, if the organization of oil producers fails to prevent member countries from adjusting their crude production without approval.

News ID: ۷۴۵۸۵۰

11 August 2018

After months of underproduction, the Organization of Petroleum Exporting Countries agreed with Russia and other oil-producing allies to raise output from July by returning to 100% compliance with previously decided cuts, CNBC reported.

That would mean an output increase of roughly 1 million barrels per day.

Zanganeh sent a letter to his UAE counterpart, Suhail al-Mazrouei who holds the OPEC presidency, complaining that some OPEC members were trying to adjust output, according to Financial Tribune.

He also told Mazrouei that an OPEC and non-OPEC committee that monitors output compliance, aka JMMC, should not distribute output increases among other producers.

"In case JMMC does not fulfill its mandate ... and has a different understanding from the decision of the conference, the issue should be raised at an extraordinary meeting of the OPEC conference for decision-making," Zanganeh wrote.

OPEC sources, however, played down the possibility of an extraordinary meeting.

"There is no need," one OPEC source said.

The comments of Iran's oil minister underline the still-simmering tensions after OPEC's June meeting.

Saudi Arabia said the deal allowed countries able to produce more to meet the group's overall conformity level, meaning some members, such as itself, could make up for shortfalls elsewhere.

Iran, which faces US sanctions, disagreed and criticized Saudi plans to boost output above targeted levels.

JMMC is chaired by Saudi Arabia and is due to meet next on Sept. 23 in Algeria.

Iran is not on the committee, which also includes Russia, the UAE, Oman, Kuwait, Algeria and Venezuela.

Last month, Zanganeh told his Saudi counterpart that the OPEC supply pact does not give member countries the right to raise oil production above their targets.