Zangeneh once again emphasized that the Islamic Republic would increase its oil production by at least 0.5 million barrels per day after the lifting of the sanctions which he said could occur in early 2016.
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OPEC is unhappy with crude prices hovering at around $40 a barrel, but only a few members appeared ready to cut output in an attempt to drive up supply and prices.
OPEC’s decision has completely erased yesterday’s gains for WTI futures, which were largely bolstered by rumors of the group’s largest crude oil exporter, Saudi Arabia, to propose a production cut at the meeting.
The surplus could soon become more severe.
It highlighted efforts by poorer oil-producing nations to protect their income from weak prices by raising production – making the over-supply issue worse.
“The current indecisive approach of OPEC in Vienna has shown that the oil cartel is not a single block”, Cyril Widdershoven, a senior vice president at MEA Risks LLC in the U.S, said. As a result, the demand for oil fell and by 2 p.m. on Monday, Brent had decreased by 20 cents, reaching $44.66 a barrel, and while U.S. Crude went up by 1 cent to $41.72, it was still significantly lower than its session high of $42.61.
That means an already oversaturated oil market is going to remain that way.
Venezuela originally hoped to reduce OPEC output by 1.5 million barrels per day, according to the Financial Times.
Amidst falling oil prices, a lowering of the output ceiling to prop up price was half expected by some analysts but OPEC decided otherwise, opting instead to keep its market share.
The Organization of Petroleum Exporting Countries sent crude prices reeling a year ago when it chose to maintain output, continuing to pump into an oversupplied market as it sought to force higher-cost producers to scale back their operations.
OPEC last met this summer in Vienna, when it agreed to leave its production ceiling unchanged at 30 million barrels per day.
“We can not put a number now because Iran is coming, we don’t know when Iran will come, and we will have to accommodate Iran one way or the other”, said OPEC Secretary General Abdullah el-Badri.
“We have said on more than one occasion, we are willing to cooperate with anyone who can balance the market”, Saudi Arabia’s Oil Minister Ali al-Naimi was cited as saying by Reuters.
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– Says that global oil companies have responded positively to Iran’s production contract proposals so far, but have yet to sign MOUs.
