Is Iran preparing a new OPEC?

Is Iran preparing a new OPEC?

The former Director General for the Caspian Sea and Central Asia of the Ministry of Oil of Iran, Mahmud Khagani, who was an adviser to the Iranian North Drilling Company business development and joint projects, as well the head of the Department of Energy, Mineral Resources and the Environmental Secretariat of the Organization of Economic Development, has information that Iran can initiate the creation of a new type of Organization of Petroleum Exporting Countries, which will negotiate directly with the end users. 

"Today OPEC may be considered a dysfunctional organization due to the wrong policies of Saudi Arabia and its allies. At the present time, the energy markets require new multilateral institutional frameworks,’’ Trend cites his article. 

Iran has repeatedly warned OPEC that the cartel's current policy is unsustainable. At a time of daily falls in oil prices, OPEC and other oil producers, particularly in Central Asia and the Caspian region, need to have a common goal. Since 2001, OPEC's role in establishing the world price of oil has gradually been reducing to zero, Khagani said. 

According to the article, ‘‘now the oil market is in a situation similar to the situation in 2008. The price of WTI has fallen to $40 a barrel.’’

"OPEC was created for the development of its members for a unified approach that corresponds to the economic interests of each country. According to political motives, some members of the cartel are co-operating now against the interests of other members," Khagani says, noting that today countries that depend on oil and gas exports are experiencing a situation where their main consumers, such as India and China, have a recession and a crisis that may be more intensified. 

"In fact, now the prices of many commodities are falling because of too much supply of oil, gas, coal, etc."

Khagani names a potential tightening of US monetary policy as another reason for the fall in prices for goods, which could lead to a strengthening of the dollar against other currencies.

At the same time, Iran's ambitions aren’t confined to oil production: the country intends to increase its stake in the largest Azerbaijani gas project ‘Shah Deniz’, the Minister of Communications and Information Technology of Iran, co-chairman of the Iran-Azerbaijan intergovernmental commission on economic, trade and humanitarian cooperation, Mahmoud Vaezi, said in an exclusive interview.