Khobar- Crude oil extended gains after Iran said it supported a proposal by Saudi Arabia and Russia that would freeze production at near-record levels, without saying whether it would curb its own output.
A provisional agreement to freeze oil production at January levels was reached in Doha on Tuesday between Saudi Arabia and Russia, the world’s two biggest exporters, as well as Qatar and Venezuela. But the deal is contingent on other big producers taking part.
The agreement reached in Doha is aimed at stabilizing global oil prices, which recently plunged to less than $30 a barrel, a 13-year low. But Iran is keen to ramp up exports to regain market share now that sanctions related to its nuclear program have been lifted under a landmark agreement.
“Iran supports any measure to boost oil prices,” Oil Minister Bijan Namdar Zanganeh said after talks with his counterparts from Iraq, Venezuela and Qatar.
Bijan Zanganeh said “Iran backs the decision taken to freeze the production ceiling of OPEC and non-OPEC members and any measures, which help stabilize the market and improve the price of crude oil”, according to state news agency Shana.
Shana added that Iran Oil Minister also said Iran will not forgo its shares in the market. The nation pumped 2.86m barrels a day in January, making it the fifth-biggest producer in OPEC.
Iranian officials had said the country will defend its right to meet its pre-sanctions production levels.
The four countries made their announcement following an unexpected meeting in the Qatari capital that pointedly did not include Iran. They agreed to act only if other producers made similar freezes.
The United Arab Emirates’ energy minister, Suhail Mohamed al-Mazroue, said that his country’s oil policy “is open to cooperate with all producers toward mutual interest of the market stability and we are optimistic on the future.”
Kuwait, another Gulf OPEC member, signaled it was willing to go along with the Doha plan.
Anas al-Saleh, who is Kuwait’s deputy premier, finance minister and acting oil minister, said in a statement that his country was committed to the proposal if others join in.
“Kuwait hopes the agreement would provide a positive atmosphere for oil prices, and for the market to regain balance, and calls on all to support stability of markets,” he said.
Iraq is ready to join Saudi Arabia in freezing or cutting output if others commit to the accord, said an official who asked not to be identified.
Moreover, an Iranian newspaper reported that Iran’s envoy to OPEC, Mahdi Asali, said regarding this matter: “demanding Iran to freeze its oil production level is illogical”.