NIOC Could Double Oil Output if US Siege Is Lifted: Zanganeh

EghtesadOnline: The National Iranian Oil Company aims to produce 4.5 million barrels a day of oil and gas condensate in the next calendar year starting on March 21, the oil minister told lawmakers on Saturday.

News ID: ۷۵۱۷۱۲

15 December 2020

“We will increase oil exports to 2.3 million barrels a day provided the US eases sanctions on the energy sector,” Bijan Namdar Zanganeh was quoted as saying by IRNA.

The projected exports are expected to cover 25% of the national budget for the year ending March 2022 -- a sign that the government is reducing dependence on oil income, he said

Iran’s oil production capacity has almost halved to 1.9 million barrels a day since Donald Trump withdrew from the Iran nuclear deal in 2018 and announced tough new sanctions that have the form of an economic siege.

“We are ready to double oil production in the next year.”

Exports, as high as 2.6 million barrels a day three years ago, have dropped to just 133,000, according to data compiled by Bloomberg.

Almost all of Iran’s shipments go to China. Extra exports from Iran, the news agency claimed, would cause problems for OPEC+, which is trying to keep output down and bolster prices in the face of the coronavirus pandemic. While Iran is an OPEC+ member, the organization has exempted it from production cuts due to the sanctions and its economic hardship.

President-elect Joe Biden, who is scheduled to be sworn in on Jan. 20, has signaled he wants to bring the US back into the historic agreement that was brokered when he was vice president under Barack Obama.

Still, some traders doubt Washington will be inclined to allow more Iranian exports at a time when oil demand is constrained by the virus, Bloomberg said.

“I am not of the view that we are going to see too much Iranian oil in the market” in 2021, Mike Muller, the head of Asia for Vitol, the world’s biggest independent oil trader, said in an interview Sunday with Dubai-based consultant Gulf Intelligence.