Iran will double oil exports after sanctions; won't give up market share

Tehran (Platts)--20Nov2014/847 am EST/1347 GMT

Iran's oil exports will double within two months if sanctions are lifted as a result of crucial nuclear talks between Tehran and six world powers reaching a comprehensive agreement, oil minister Bijan Zanganeh said Wednesday.

Zanganeh, in a live interview on state television, said Iran would not relinquish a single barrel of its share of the market.

"If the sanctions are lifted, our oil exports will be doubled within two months. I will not back down even one barrel from the Iranian share of the market," he said.

The minister did not say how much oil Iran was currently exporting, but said the volume was "much lower than 2 million b/d."

He put the country's domestic oil consumption at 1.7 million-1.8 million b/d.

Nor did he give a figure for current wellhead production, but said, "We can increase our production within a few months, if the nuclear talks end positively."

Specific sanctions targeting Tehran's oil revenues, in effect since mid-2010, have slashed Iran's crude exports to around 1 million b/d from previous levels of around 2.2 million-2.3 million b/d.

The nuclear talks are scheduled to end on November 24, three days before OPEC's November 27 meeting.

Oil prices have plunged by as much as $36/barrel since June, dipping below $77/b last Friday.

ICE January Brent crude futures settled 37 cents lower at $78.10/b Wednesday.

Zanganeh has been involved in high-level diplomacy in the runup to next week's OPEC talks, last week delivering messages from President Hassan Rouhani to the rulers of Kuwait and Qatar. On Tuesday he made a similar visit to the UAE.

He said in the interview that he would consult with Saudi Arabian oil minister Ali Naimi in Vienna ahead of the OPEC meeting.

"God willing, when we go for OPEC meeting, on Wednesday, I think we can consult," he said.

"We must work towards bringing members closer to consensus within OPEC so that the oil price goes up," Zanganeh said.

"We try to act to help prices become balanced. We shouldn't accuse each other inside the organization. We should aim for maximum collective benefit. If one member is against the other we will not reach a decision," he said.

"Everybody [every producer] is influential as much as its production capacity... If the nuclear talks reach a [conclusive] result, then Iran can become an influential member of OPEC in the market."

Zanganeh said countries that were producing "extra" oil should reduce it, but declined to say whether he was referring to Saudi Arabia.

"The party responsible for regulation of the market is the one which is producing more. The party that is producing extra should take it [the additional production] back," he said.

Zanganeh did not respond directly when asked whether he had asked Qatar, Kuwait and the UAE to cut their production.

"They are all flexible," he said, however.

"The countries at the southern shores of the Persian Gulf are more inclined to keep their share of the market and it is a bit difficult for them to decrease their production," Zanganeh said. "We will listen to all in Vienna next week," he added.

--Aresu Eqbali, newsdesk@platts.com
--Edited by Margaret McQuaile, margaret.mcquaile@platts.com, and Lisa Miller, lisa.miller@platts.com

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