The planned meeting between OPEC members which was set to take place in Russia on March 20 looks unlikely as Iran has not decided whether it would participate in the deal.
According to Reuters, OPEC officials had earlier said a meeting would take place in Moscow on that date, potentially as the next step in widening an agreement to freeze output at January levels struck by OPEC members Saudi Arabia, Venezuela and Qatar plus non-member Russia last month.
But the biggest roadblock to a wider deal, OPEC delegates say, is Iran. Tehran feels it should be exempt from the agreement as it wants to recover market share it lost under Western sanctions. Kuwait said on Tuesday it will commit to the deal – if all major producers including Iran do so.
“They are not agreeing on the meeting. Why would the ministers meet again now? Iran says they will not do anything,” said an OPEC source from a major producer. “Only if Iran agrees, things will change.”
According to Dolapo Oni, Head Research Oil and Gas Desk at Ecobank, “OPEC is sacrificing what it has fought for the most which is market share. They are basically trying to rein in on their members to create a bond that hasn’t existed in recent times.”
“Our view is not to go there with the possibility of no agreement so as not to affect prices negatively,” said another source from a major OPEC member, referring to the proposed March 20 meeting.
Iran is seeking to scale up production to the levels it was before sanctions were applied on them, and has rejected freezing its output at January levels, put by OPEC secondary sources at 2.93 million barrels per day (bpd).
“Tehran wanted a freeze … for them to be based on 4 million barrels per day, their pre-sanctions production figure,” said one source familiar with the discussions. A source familiar with Iranian thinking agreed.
If OPEC wants the matter resolved quickly it would most likely after to offer a fair deal to Iran.
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