Despite the gridlock, Saudi Arabia said it is “always ready” to help arriving Iranian pilgrims.
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It is true that Iran has almost reclaimed its pre-sanctions oil output, but whether the country will consider a freeze to the output growth depends on the government’s policies, said Mohammad Ali Khatibi, former Iranian representative in OPEC.
The last meeting of oil producers in Doha ended without any agreement.
“At dawn on Friday, the Iranian mission expressed its desire to leave to home without signing the minutes of arrangements”, the official Saudi Press Agency reported late on Friday. Below the surface, the issue is not about a fair oil production cap.
“They have to answer to their own people”, Khashoggi said, adding that Saudi had made concessions for Iranian pilgrims.
Hence, in the past two years Riyadh has stuck to a strategy of fighting for market share, thinking that pumping more oil now at low prices is better than producing less in the future. “The expectation is for more decline in non-Opec supply”. Russian Energy Minister Alexander Novak told the media at a global energy summit in Moscow that the Saudis “have the ability to raise output significantly”. It has wasted no time in joining what has become the petroleum equivalent of the infamous arms race of the Cold War. Iran officials didn’t attend April’s meeting.
Tehran, however has boosted crude output at the expense of prices.
According to the Saudi General Authority for Statistics, trade exchange between the kingdom and Turkey reached $6.5 billion in 2014 and increased by 23 per cent in 2015. “This return of disrupted supply and OPEC’s increasing of production lay the foundation for a wider market surplus, and for prices to fall back below $40 in the short run”. “It is very ridiculous, they come up with the proposal on freezing oil production and call for this freeze to take place in their 10-million-barrels-a-day production vis-à-vis Iran’s 1 million barrels a day”.
The talks were the second attempt by both countries after an unsuccessful first round last month to iron out differences and reach a deal on organizing this year’s Haj journey for Iranian pilgrims.
He added that “the talks will be held on Wednesday in Jeddah”.
Ohadi went on to say that the Saudi delegation has revealed that it does not have the necessary power to make the final decision on the disputed points, and it showed that other parts in the Saudi government were directly involved in dictating the terms of this year’s Hajj agreement.
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Saudi officials accused Iran of walking out of talks early on May 27, despite their having offered “solutions” to Iranian demands.
