Oil prices jump after unconfirmed reports say Iran may join a push to freeze production at current levels.
Iran
has been ramping up output since the lifting of sanctions in January to
reclaim its lost market share, dismissing demands to join the freeze
initiative.
On Tuesday, Reuters cited unnamed sources as saying
that Iran was sending “positive signals” that it might get behind the
push to curb production.
“Though Iran has not yet decided
whether to join a new effort, Tehran appears to be more willing to reach
an understanding with other oil producers,” the news agency quoted the
sources as saying.
Iran, the source said, was on course to reach
its pre-sanction production level soon, after which it would join other
producers to freeze output.
Iranian officials have already
signaled that the country would support the initiative after its crude
production reached the level it desired. A view of Kharg Island from which Iran exports most of its oil to the market (Photo by Shana)The Islamic Republic exported up to 2.3 million barrels per day of crude before sanctions cut it by half in 2012.
On Friday, Reuters said its latest figures confirmed that Iran’s exports had surpassed two million barrels per day (bpd).
Director
for international affairs of the National Iranian Oil Company (NIOC)
Mohsen Qamsari said Iran’s total exports hit 2.74 million bpd in June.
The figure included 0.6 million bpd of condensate.
Qamsari said
Iran was still exporting around 0.4 million bpd less than the average it
released on the market before sanctions were imposed against the
country.
There was no immediate reaction from Iranian officials to Reuters’ report on Wednesday.
Members
of the Organization of the Petroleum Exporting Countries are due to
meet informally in Algeria next month on the sidelines of the
International Energy Forum which groups both producers and consumers.
Reuters
quoted an unnamed OPEC source as saying that Iran had confirmed it
would participate in the Sept. 26-28 meeting in which members would
probably revive talks on freezing oil production levels.
The
report caused oil prices to jump on Tuesday. In London, Brent North Sea
crude for October rose 80 cents to $49.96 a barrel. US benchmark West
Texas Intermediate for October delivery ended up 69 cents from Monday at
$48.10 a barrel.
The previous attempt to freeze output collapsed
in April after Saudi Arabia insisted that it would join the
initiative, supported by non-OPEC producers such as Russia and
Venezuela, only if Iran were on board.
The kingdom has reached
record production, leading to a collapse in prices which has hit the
country hard as well as other producers.
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