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Thursday, August 27, 2015

Iran says not willing to give up quota in OPEC, share in world market.

Iran says not willing to give up quota in OPEC, share in world market.(Taz).

Iran’s Oil Minister Bijan Namdar Zanganeh said that Iran will not give up its quota in OPEC and its share in world market.

Speaking on Iranian State TV Aug. 26, Zanganeh said Iran will raise exports even if the oil prices fall.

The Islamic Republic of Iran will by no means ignore its quota in OPEC and the world oil market. We have no problem with slashing of oil prices on the global market because we can double our oil exports,” said Zangeneh, adding, “We should bypass the tyrannical conditions imposed on our country because maintaining Iran quota in OPEC and world market is among our vital parameters.”

Those should be concerned that have extra income and production in the world markets; On what ground should Iranian government do something to lose its historical share in the oil market just because oil prices should increase,” he said.

Noting that the OPEC members should reconsider current oil production, Zanganeh said to this end, OPEC members have been asked to hold an extraordinary session that will be held if all the 13 members agree to it on consensus. Certain OPEC members do not wish increase in the prices and want to harm other members through low prices as a result of oversupply, he concludedHmmm.....I said it before and say it again, 'Iran will use it's huge stockpile as leverage to gain back their OPEC Share, if OPEC doesn't give in to their demands the will dump all their stocks on the market crashing the OIL market prices.' Nobody wants $20/Barrel prices.


OPEC to keep "no output cut" policy

OPEC has roughly split into two groups, Pugh said in a report.

“The first group wants to maintain the current output target. This group consists mainly of the wealthier Gulf countries, that is, Saudi Arabia, Kuwait, Qatar and the UAE. The second group consists of the poorer members of OPEC who want a cut in production, namely Iran, Iraq, Nigeria, Algeria, Venezuela, Libya, Angola and Ecuador.”

“The second group outnumber the first by 2-1 and could call an emergency meeting if they wished. (It only needs a simple majority of the 12 members to call an emergency meeting.) But it is largely seen as pointless without the support of Saudi Arabia, by far the group’s largest producer,” Pugh said.
In addition, none of the second group are really in a position to cut their own output, according to the economist.

“Indeed, of the eight countries we put in the second group, both Iran and Iraq are recovering from decades of sanctions and have said they actively plan to pump as much oil as possible, regardless of the price. Libyan output remains disrupted by fighting so barely has any output to cut, and the African and South American members are struggling financially so they need to continue pumping at full blast to maximize revenues,” he said in a report.

“As a result, when these countries call for a cut in the production target, they are really calling for Saudi Arabia and its allies to reduce output,” Pugh said. And he doubts that the first group’s countries are altruistic enough “to cut their production purely to benefit the rest of OPEC and non-OPEC producers, especially as the prime beneficiary would be Saudi Arabia’s long term rival, Iran.”
He also believes that even if an emergency meeting is called, and a production target cut is agreed upon, there is little chance of the group actually sticking to it.

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