Iranian minister calls Trump's order to Opec insulting

Wednesday, 11 Jul, 2018

"There hasn't been a significant change in our production and exports so far, and in response to USA actions Iran will advance according to its plans and policies", Zanganeh said.

The move came as Iran - an OPEC member - faces renewed sanctions over Trump's decision to quit the global nuclear deal with Tehran, which has added to supply concerns on world markets.

Based on IEA estimates, the kingdom can raise production to just over 12 million bpd and sustain it at that level for an extended period, the report added.

Iran plans to reduce its worldwide trade relations only to countries that buy its crude oil, an Iranian MP told Iranian media.

Bijan Zanganeh condemned the United States president for trying to politicize the decisions of the Organization of the Petroleum Exporting Countries (OPEC). The Iranian official also criticised a reported request that the United States made of Saudi Arabia to help stabilise oil prices in case the sanctions against Iran drives oil prices up.

Iran's Petroleum Minister said US President Donald Trump has recently made "interfering" remarks on the Organisation of the Petroleum Exporting Countries (OPEC). At the same time, other countries face higher energy prices.

In practice, some analysts think the market could be much tighter, with sanctions essentially using up all the spare capacity worldwide. At the time, Saudi Arabia's Khalid al-Falih said the number was "nominal" since not all OPEC members had the spare capacity to boost production.

But according to the U.S. Energy Information Administration, the kingdom has not produced more than 10.42 million bpd on an annual basis (2016) or 10.63 million bpd in a single month (July 2016) in the last 20 years.

"Maximum production would require opening the chokes on existing wells and bringing previously shut-in wells back into service", Reuters added. But now there is growing worry that even a one-million-bpd increase will not be enough.

The truth is, if the rest of the world followed Trump's demands and returned to sanctions and boycotting Iranian oil, some 2.7 million barrels per day now supplied by Iran would be very hard to make up elsewhere. "Thus, it appears the oil market has little confidence that Iran volumes can be easily replaced", BofA Merrill Lynch analysts said.