Markets were flush with excitement at the prospect of an agreement which would not only bring some much-needed stability to the volatile commodities market, but also mark the first joint OPEC and non-OPEC deal in 15 years.
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Mr Zanganeh did not explicitly say in his remarks quoted by Shana that Iran would keep its own output at its January level.
But traders were encouraged by closed-door talks in Tehran by Iran’s oil minister with his counterparts from Iraq, Venezuela and Qatar.
“The decision taken so that OPEC members and non-OPEC (countries) freeze their production ceiling in a bid to stabilize the market and improve prices in the interest of consumer and producer is also supported by us”, he told reporters. “We want to meet demand and we want a stable oil price”.
“Although this is the first step it should not be the last”. Iran’s return this year as a global oil exporter after agreeing to halt its nuclear program added to pressure.
The comments came ahead of a meeting in Tehran of oil ministers from Iran, Iraq and Venezuela to discuss a proposal to freeze production in order to battle a drop in oil prices.
Iran’s crude output is now in the region of 3 million barrels per day.
Still, expectations that Iran will continue to increase production and January’s high production rates ensure that oil prices will remain under significant pressure.
Earlier, the Islamic Republic’s OPEC envoy Mehdi Asali said: “Asking Iran to freeze its oil production level is illogical”, according to Iranian newspaper the Shargh.
Oil prices were higher on Wednesday morning as OPEC oil ministers traveled to Iran to talk about a possible production freeze between global oil producers.
Iran, the Organisation of the Petroleum Exporting Countries’ fourth-largest producer, might be offered an exception as it seeks to ramp up production following the removal of sanctions over its nuclear programme last month, analysts said.
Iran just had its sanctions lifted and wants to win back the market share it lost to Saudi Arabia and other countries while under export sanctions. They touted the deal as a big step towards tackling the oil supply glut, but it failed to please the market.
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West Texas Intermediate for March delivery rose as much as $1.06 to $31.72 a barrel on the New York Mercantile Exchange and was at $31.28 at 9:11 am Hong Kong time. The U.S. benchmark surged 5.6 percent in the previous session to close at $30.66 a barrel.
