Iran to reject Saudi-Russia proposal to increase oil production

Iran’s representative to the Organisation of the Petroleum Exporting Countries (OPEC) said that his country as well as Iraq and Venezuela will reject any proposal from Saudi Arabia and Russia to increase oil production.

In an interview with Bloomberg Hossein Kazempour Ardebili confirmed yesterday that the three OPEC founders would oppose the proposal: “If the Kingdom of Saudi Arabia and Russia want to increase production this requires unanimity. If the two want to act alone, that’s a breach of the cooperation agreement.”

OPEC members and independent producers began in early 2017 to cut oil production by 1.8 million barrels per day in a bid to restore stability to oil markets. However, the deal ends in December, later this year.

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According to Bloomberg, the warning came after Russian Energy Minister Alexander Novak said that “Moscow and Riyadh have agreed to cooperate in the oil market. Now Saudi Arabia and Russia can increase their oil production because the two countries are producing less than their capacity”.

OPEC members and independent producers will meet in the Austrian capital, Vienna, on 22 June to discuss a future production policy.

Russia and Saudi Arabia are expected to increase their production to compensate for the potential decline in oil production after US sanctions on Iran and Venezuela.

The Organisation of the Petroleum Exporting Countries (OPEC) is currently producing about 31.86 million barrels per day.