Speaking on the sidelines of the St. Petersburg International Economic Forum on June 3, Leonid Fedun said: “If sanctions are lifted, Iran will be able to offer up to 1.5 million barrels of oil per day to the market in the near time.”

Iran is a key factor for the Organization of Petroleum Exporting Countries (OPEC) and it is more important than the demand in the global oil market, the top manager said.

“Shortage may turn into surplus. That is why OPEC is so cautious in all its actions,” Fedun noted.

In late May, Iran’s Oil Minister Bijan Namdar Zanganeh had said Iran could “easily” boost its oil production capacity to 6.5 million bpd.

“We can easily reach 6.5 million barrels per day,” Zanganeh said at a ceremony to award studies on the country’s giant Azadegan oil field on May 31.

Zanganeh said Iran is ready to return to the oil market as soon as the nuclear deal known as the Joint Comprehensive Plan of Action (JCPOA) is revived and the U.S. sanctions are lifted.

Iran is gradually boosting crude oil production to get ready for a strong comeback into the global market as the talks with world powers over the 2015 nuclear deal show signs of progress.

Earlier in May, officials from the National Iranian Oil Company (NIOC) had stated that the country’s oil fields are going through overhaul operations and connections with oil buyers are being re-established, according to a report by Bloomberg.

“In the most optimistic estimates, the country could return to pre-sanctions production levels of almost four million barrels a day in as little as three months,” the report said.

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During the meeting with the Iraqi delegation headed by the Iraqi Minister of Finance Ali Abdul-Amir Allawi, Mr. Zangeneh voiced Iran’s readiness to bolster gas exports to Iraq, adding: “We hope Iraq would pay its debt to Iran as soon as possible.”

During the meeting, which was also attended by Iranian Energy Minister Reza Ardakanian, the payment of Iraq’s electricity debt to Iran was also discussed.

The meeting was accompanied by Iraqi Finance Minister Ali Abdul Alawi, Iraqi Electricity Minister Majid Mahdi Hantoush and State-owned Trade Bank of Iraq (TBI) CEO Salem Chalabi.

Iran and Iraq are set to find a final solution to settling Iraq’s debt to Iran this week through joint meetings.

This is the second meeting between Iranian Minister of Petroleum Bijan Zangeneh and the Iraqi delegation in less than a month.

During the meeting in May, Zangeneh had said: “Two important contracts in the field of Iranian gas exports to Iraq have been signed with the Iraqi Ministry of Electricity in recent years and 27 billion cubic meters of Iranian gas have been exported to Iraq so far.”

After the meeting Iranian Energy Minister Reza Ardakanin said after the meeting on Saturday that Iraq’s TBI would process payments worth $125 million from Iranian funds held in the bank to a Swiss lender for supplies of more than 16 million doses of coronavirus vaccines ordered by Iran under an international scheme.

“It is expected that administrative work is completed until the end of this working week (Thursday) and these vaccines will soon be available to the Iranian health ministry,” said Ardakanian.

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According to Torbati, the supply of natural gas to the strategic port and to the Makran coasts is going to create industrial prosperity in the region, Shana reported.

Speaking in a follow-up meeting on Sistan-Baluchestan gas supply projects, Torbati said due to the vastness of the province, in total, 2,000 sections of gas pipelines have been designed and planned to be implemented across the province, of which so far 300 kilometers (km) have been implemented and 770 km of pipelines are currently being implemented.

Torbati put the projected capital for the implementation of the mentioned pipelines with the gas supply facilities in the cities at more than 200 trillion rials (about $4.7 billion), saying that the necessary steel sheets and pipes for the mentioned pipelines have been provided.

Back in February, Iranian Oil Minister Bijan Namdar Zanganeh had stated that over 95 percent of the country’s population is currently enjoying natural gas through the country’s huge national network.

According to the Oil Minister, the coverage of the national gas network in rural areas has also doubled over the mentioned period to reach 84 percent.

Since the Iranian calendar year 1392 (March 2013) up to the previous calendar year’s 11th month (started on January 20) over 20,000 rural areas with a total population of 1.76 million households have been supplied with natural gas through the national gas network, according to Zanganeh.

Chabahar Port, the only Iranian ocean port, is a strategic port with unique opportunities that can attract investments from Iranian and foreign private sectors.

The development of the Chabahar Port is important for the economic development of the region and also the neighboring countries and in this regard sustainable supply of energy carriers to the port has been of significant importance for the Iranian government and the projects for expansion of the national gas network in Sistan-Baluchestan province, where the port lays, have been seriously pursued by the NIGC over the past few years.

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In this meeting, the minister addressed the most important programs and goals for materializing this year’s slogan and emphasized: “The main goal [of these programs] is to focus on issues and problems that can be addressed and solved within the oil industry.”

The official mentioned a letter that he had written to the heads of the four major companies regarding the main plans for the current year, saying: “I expressed my views on the subject and asked the heads of the four companies to draft a document to determine the measures that should be taken in the months to come.”

Zanganeh further mentioned the great progress made in the oil industry during the previous year, and noted that sanctions were a determining factor that had a strong impact on the plans and programs of the Oil Ministry.

Elsewhere in the meeting, Deputy Oil Minister for Planning Houshang Falahatian briefed the attendees on the Oil Ministry’s programs for the current year.

According to Falahatian, the oil industry’s executive plans for the current year are prepared with a focus on the three sectors of production, support, and barriers in order to fulfill the motto of the year.

Maintaining and increasing oil production, managing subsidiaries, manufacturing in-house equipment, and goods required by the oil, gas, petrochemical, and refining industries, reducing paperwork and eliminating unnecessary regulations in the oil industry, optimizing and upgrading existing refineries, developing downstream oil and petrochemical industries, reducing gas consumption, increasing the production capacity of natural gas, development of the petrochemical industry and accelerating the implementation of projects related to the second and third leaps of petrochemical industry were among the major goals that the ministry has put on the agenda for the current year.

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A ceremony was held in Tehran yesterday (Monday) to strike the deal in the presence of Oil Minister Bijan Zangeneh, the CEO of NIORDC Alireza Sadiqabadi, Reza Rahmani, Minister of Industry, Mine and Trade Reza Rahmani, Chairman of IMIDRO Khodada Gharibpour as well as the heads of the two refineries.

By signing this agreement, the Research Institute of Petroleum Industry (RIPI) will cooperate with IMIDRO to launch a coke production unit in the two refineries and the needle and sponge coke required by the steel industry of the country will be produced from low-sulfur fuel oil domestically.

The pilot plant of the unit will be built at RIPI, and with the signing of this MoU, industrial-scale coke units will be contracted in the refineries afterward.

This agreement is of great strategic value for Iran given the U.S. sanctions imposed on the import of pet coke to Iran.

There are at least four basic types of petroleum coke, namely, needle coke, honeycomb coke, sponge coke and shot coke. Different types of petroleum coke have different microstructures due to differences in operating variables and the nature of the feedstock. Significant differences are also to be observed in the properties of the different types of coke, particularly ash and volatile matter contents.

Addressing the ceremony, Zangeneh said the production of sponge and needle coke in the country needs one billion dollars of investment.

He added that it is expected the agreement to turn into a contract and the plan is carried out. The minister said in the past there was a problem in finance but the involvement of the Research Institute of Petroleum Industry in the project has solved the woe of necessary license for production of coke.

Zanganeh added that one of the programs of the ministry is to improve the quality of the outputs of refineries, adding that the ministry is determined to move from producing heavy products to lighter ones while around 6 to 7 million liters of feed is used for production of coke and in such a project, the output mazut from the refineries is decreasing.

He reiterated that the project needs over one billion dollars of investment.

Meanwhile Sadiqabadi, for his part, said that by the agreement which was signed for producing sponge and needle coke, about 620,000 tons of sponge and needle coke in which aluminum industry needs will be produced.

He added that the program for improving the quality and increasing the capacity of the refineries in the country is something that kicked off 18 years ago and necessary initiative plans and technologies regarding the projects were provided. Sadiqabadi further said because of those measures, refining capacity in the country soared from 1.6m barrels of oil per day to 2.3m barrels of crude oil and condensate per day.

He noted that the gasoline capacity of the country was 37m liters per day 18 years ago but it has currently enhanced to around 110m liters per day.

Sadiqabadi also said the amount of mazut production was then around 70m liters and today it has reached 120m liters per day.

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TEHRAN (Iran News) – Iran will soon bring online its biggest refinery for natural gas flare associated with oil production, built with $3 billion of investment, Minister of Oil Bijan Namdar Zanganeh said.

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The group of more than 20 producers agreed to an extra 500,000 barrels per day (bpd) in cuts for the first quarter of 2020, taking the total to 1.7 million bpd, or 1.7% of global demand, Reuters reported.

The Organization of the Petroleum Exporting Countries and allied producers, the so-called OPEC+, pump more than 40% of the world’s oil. They held a closed-door meeting to thrash out how the additional cuts will be distributed.

OPEC is likely to shoulder approximately 340,000 bpd in fresh production cuts and non-OPEC producers an extra 160,000 bpd, one source said on Friday.

Oil moved higher on Friday. US West Texas Intermediate crude futures gained 1.7% to trade at $59.40 a barrel. Brent $1.10, or 1.8%, to $64.51.

Prices spiked as Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman said the nation would continue to exceed its quota by 400,000 barrels a day, which means the overall production cut will actually be closer to 2.1 million barrels a day.

Russian Energy Minister Alexander Novak said at a press conference on Friday that Moscow’s quota will be 300,000 bpd during the first three months of 2020. This measurement excludes gas condensate — a high-value light crude extracted as a by-product of gas production.

OPEC+ will deepen cuts for the first three months of 2020, shorter than the six- or 12-month scenarios some OPEC members wanted.

The production cuts offset an expected increase from countries that are not part of OPEC+, including top producer the United States.

OPEC met on Thursday in Vienna, deliberating policy for more than five hours. The length of the meeting prompted the cancellation of a news conference and a gala dinner for delegates aboard a boat on the Danube.

Eleven of OPEC’s 14 member states are participating in the supply curbs. Iran, Libya and Venezuela are exempt.

OPEC+ adds Russia and nine others – Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, South Sudan and Sudan.

One sticking point has been compliance, with Saudi Arabia cutting more than required in order to offset overproduction from Iraq and Nigeria.

“A scenario where the Saudis ‘absorb’ the majority of a 500,000 bpd cut and formalize their target at current output levels would not be impactful to the market – unless Iraq and Nigeria come into compliance with their targets,” said analysts from Jefferies.

ING bank analysts said the key question was whether the new cuts were real or just a matter of Saudi Arabia formalizing its current over-compliance.

“Obviously, if it is the latter, the market will be disappointed, as this will do little to eat into the surplus over the first quarter,” ING said.

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He also said that two regional countries had shown hostilities toward Iran, adding, “We are not their enemy, but they are hostile to us and make OPEC a political organization and use oil as a weapon in the world and global markets against us.”

“Oil is not a weapon and it should not be politicized; we have always said that the oil market should be apolitical and oil should not be used as a weapon, because it would hurt OPEC and its members, and I believe that these countries are driving OPEC towards collapse, but we want OPEC to be preserved; these two countries will undermine this organization by instigating infighting in the bloc.”

Asked whether a country like Saudi Arabia would pull out of OPEC, he said Saudi Arabia would not go out either.

“We remain in OPEC, but the issues I mentioned above hurt the dignity, integrity, steadfastness and stability of OPEC and the blame falls on the countries that do this.”

Asked whether Saudi Arabia and the UAE were able to offset the shortage caused by eliminating Iran’s oil in the market, Zangeneh said that “No one can compensate for this vacuum.”

“The market is fragile and unstable, and these countries are doing everything they can to prevent oil prices from rising by propaganda and downplaying the events, for the benefit of the United States and the Zionist regime,” he said.

“All these are to the detriment of the people, OPEC members and oil producers, and even the consumers, because they would create instability in an already fragile market. The price fluctuations that drop in $5-6 a barrel within 24 hours are beneficial to no one; do not think that this would be in the interests of the consumers, because in this situation no one knows what they should do, and a producing country would not know whether to keep its supplies or sell them; so price fluctuations would not benefit anyone in the market.”

Asked about steps that should be taken to ensure stability in the market, Zangeneh said, “oil should no longer be treated as a political tool… Oil is not a weapon; rather it is a commodity needed in the global economy.”

The Iranian Minister of Petroleum also confirmed he would attend the upcoming OPEC meeting in Vienna later in June.

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In a letter to OPEC President Mohamed Al Mazrouei, Iranian Oil Minister Bijan Namader Zanganeh highlighted that if member countries do not adhere to their commitments regarding oil output, the effectiveness of the organization will be gradually eroded.

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The Iranian Oil Minister Bijan Namader Zanganeh has said if the Oil Ministry had signed 5 more contracts and had exported 4mn bpd, the US would not have been able to sanction Iran’s oil.

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