Tehran's representative to the Organization of the Petroleum Exporting Countries (OPEC), Mehdi Asali, said that he considers the proposal to freeze Iran's oil production now to be "illogical", Reuters reports.
"Asking Iran to freeze its oil production level is illogical. When Iran was under sanctions, some countries raised their output and they caused the drop in oil prices," TASS cited Asali as saying.
The Iranian Oil Minister Bijan Namdar Zanganeh said yesterday that Iran will not give up its quota in the international oil market.
According to officials, many countries stepped up the level of oil production while Tehran was under Western sanctions. Now these sanctions have been lifted, so Iran is going to increase the level of production.
Tehran's decision makes the implementation of the Doha agreement impossible. But it is not excluded that the talks will continue.
Some other OPEC member countries have already expressed support for the deal. In particular, the Kuwait authorities declared their readiness to join the pact, aimed at tackling a growing oversupply.
According to the country's Ministry of Oil, Kuwait is ready to fix the level of oil production in the country at the current level of 3 million barrels per day if other manufacturers join the initiative.
A senior analyst of 'Uralsib Capital', Alexei Kokin, said in an interview with a correspondent of Vestnik Kavkaza that nobody expected that Iran would agree to freeze the level of oil production at the current level without any additional conditions.
"It would be naive to expect that Iran, which has been waiting for the sanctions to be lifted for a long time, would abandon production growth. Therefore, apparently there will be negotiations between those countries which are particularly interested in the growth of oil prices – Russia and Iran," the expert said.
"I have no doubt that Iran will increase its production by at least half a million barrels per day. Iran's unwillingness to roll back to the level of production of January 11th 2016 is natural," Kokin noted.
The senior analyst of 'Uralsib Capital' reminded that the problem lies in the fact that Saudi Arabia, Kuwait and the United Arab Emirates, to put it mildly, are not in a very good relationship with Iran.
"Therefore, Saudi Arabia will not talk directly to Iran, but Russia will definitely be in contact with it on this subject. That's why I have a certain optimism about the fact that Russia and Iran will achieve at least some kind of agreement," Alexei Kokin concluded.
The leading analyst of National Energy Security, Igor Yushkov, in his turn, noted that the parties did not sign any agreements at the meeting.
"It was just a statement that if the others are willing to join, they have already agreed. But Iran was the problem since the very beginning, as initially it was clear that the country will not take on commitments not to exceed the production of the level of January 11th 2016. Representatives of Iran, on the contrary, say that they are going to raise the level of oil production, and the rest of the countries are at the peak of production, especially Russia. We have set a record in terms of crude oil production, so this is a very interesting situation," the expert said.
"Then there will be a decrease in production, because there is a natural depletion of old fields in Western Siberia, and after Vankor new large fields weren't developed [the Vankor field is a promising oil and gas field in Krasnoyarsk Territory - VK]. And Iran initially said that it is going to increase the volume, because it needs money for many projects. Plus, it supports the war in Yemen. So, firstly, I think that Iran will never take on a commitment to return to the level of production of January 11th 2016. And the actions of others is another question, whether they will be able to sign an agreement without Iran or whether they announce a certain quota to increase production for Iran. I think that there is very little chance of doing it," the leading analyst of National Energy Security believes.
"And I think that there were no negotiations with the US on this issue, but it is one of the largest oil producers in the world, they just consume all the volume of oil they produce. So I think they are not are going to restrict themselves. In the US, as well as in Russia, there is no mechanism for oil production cuts. The fact that we have such a position that we will not exceed the production of the level of January 11th 2016 is a gentlemen's agreement between the oil companies and the Ministry of Energy of Russia," Igor Yushkov believes.
"I think that the only advantage is that in a situation where we have many political contradictions with Saudi Arabia and Qatar, we still sat down at the negotiating table. And the second advantage is that Saudi Arabia has changed its position. Previously, they said they would produce oil at any price, even $20 and $10 per barrel. Now they say that they are reviewing their position, ready to cooperate, limit production, even cut it. But it will be very difficult to agree," the expert stressed.
Responding to the question of whether it is possible to convince Iran to join the initiative, the analyst suggested that the chances are minimal: "At the beginning of 2016 Iran didn't produce the volume of oil production that it would like to gain. I think that Iran may accept it or ask for a quota for an increase in production volumes to the level of January 11th 2016," Igor Yushkov summed up.
