“Iran wants a stable market and therefore any measure that helps the stabilization of the oil market is supported by Iran”, Zanganeh said.
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The meeting is the first known gathering that Saudi energy minister Khalid al-Falih has held with a fellow member of OPEC since a new round of talks around production issues began in early August. “We support oil prices between $50 and $60 per barrel”. However, oil production by the 14 OPEC member states rose by 120,000 barrels a day to average 33.69 million per day in August as against 33.24 bpd in July.
This move by the largest OPEC and one of the largest non-OPEC has received applauses from smaller producers such as Venezuela, which is one of the worst hit victims of global oil price plummet.
Now, all eyes are on the forthcoming informal meeting of OPEC in Algeria later this month but analysts are skeptical over whether the Saudi-Russia pact will have any bearing on the group as a whole. That level is “slightly” above 4 million barrels a day, and Iran may reach it by the end of 2016 or early next year, Mohsen Ghamsari, director for worldwide affairs at state-run National Iranian Oil Co., said Thursday in an interview in Singapore.
Other oil producers have welcomed the agreement between Saudi Arabia and Russian Federation to stabilize the oil market, including limiting output.
His comments came after OPEC kingpin Saudi Arabia and Russian Federation said Sunday they would work together to boost the oil market, but stopped short of committing to a production freeze.
Dismissing concerns that an oversupply of oil could dampen a price recovery and delicate rebalancing in oil markets, Dow Jones reported Wednesday Ghamsari had said the oil market would be rebalanced by the fourth quarter of this year or early 2017.
Libya’s production also dropped by 40, 000 bpd to 260, 000 bpd as the country’s political factions continued to fight over the control of oil export terminals. Additional downward pressure on crude oil prices stemmed from the weekly Energy Information Agency (EIA) inventory report which indicated crude inventories increased by 2.275 million barrels per day.
But without agreeing to curb output, it’s unclear how either country hopes to affect the price of oil around the world. A previous proposal fell through in April when Saudi Arabia insisted that Iran take part even though the country was pumping less than it did before the sanctions.
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“Now there is a push to smooth things out and solve any problem”, the OPEC source said, adding there had been no agreement yet on any level at which to freeze production.
