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Among the multitude of threats that Iran has made public since US sanctions against Iran were lifted, Iran has now announced the collapse of OPEC, though OPEC members fill the void by increasing market shares left behind by Iran and Venezuela, according to S & P Global Platts.
The Iranian Oil Minister said two OPEC members are doing it, accusing them of using their oil as a weapon. The two members Zanganeh was talking about were Saudi Arabia and the United Arab Emirates.
It is interesting to note that Saudi Arabia has unduly assumed the burden of reducing production. Saudi Arabia has agreed to maintain production at 10.311 million barrels per day, while the UAE target is 3.072 million barrels per day.
Saudi Arabia surpassed its share of production cuts with output of 9.794 million bpd in March. Similarly, the UAE is getting closer to the target – but remains below 3.059 for March.
The "oil weapon" to which Iran refers, according to S & P Global Platts, is therefore their contact with the United States to develop a plan to ensure that the oil market is well stocked. Until now, Saudi Arabia has not increased its production to fill the gaps left by Iran or Venezuela.
"Using oil as a weapon against two founding members of OPEC [Venezuela and Iran], [they] turn OPEC's solidarity into a division and cause death and the collapse of OPEC, "said Zanganeh, warning that any country using oil for this purpose should" accept the consequences " . Related: The beginning of the end for British shale gas
Iran and Venezuela have indeed suffered a drop in their oil production while the sanctions imposed on both countries limit exports and exclude buyers such as India, South Korea and Cuba who will have to shop elsewhere. to obtain sufficient quantities of crude oil.
Venezuela's oil output fell below 1 million barrels a day in March to 732,000 barrels a day, while Iran's output fell to 2,698 billion barrels a day. Iran's average output is 3.553 million bpd, while Venezuela's is 1.354 bpd, according to secondary sources provided by OPEC.
The difficult times that Iran and Venezuela are currently facing may continue to tip the balance of the oil cartel, as other members will naturally respond to market demand as much as possible.
By Julianne Geiger for Oilprice.com
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