Iran Rant Reveals How Powerless It Really Is in OPEC: Julian Lee - Bloomberg:
Iranian oil minister Bijan Namdar Zanganeh’s threat to veto any OPEC decision that harms the Islamic Republic will have no impact on oil supply and will be ignored by those producers who are able to boost their oil production, just as happened in 2011, writes Bloomberg oil strategist Julian Lee.
Zanganeh is right to say that the Joint Ministerial Monitoring Committee, which will meet in Algeria on Sunday, does not have the authority to make any decision on a new production agreement. Its job is to oversee the implementation of an existing deal, reached in 2016 with a group of non-OPEC countries, to cut supply by around 1.8 million barrels a day to reduce excess stockpiles of oil.
By June 2018, the group’s output had come down more than intended and the deal was tweaked when oil ministers met in Vienna that month. According to Saudi Arabia and Russia, they decided to bring the group’s collective production into line with the level agreed in 2016, adding about 1 million barrels a day to supply. Under Iran’s interpretation, though, the agreement was for each country to bring its own production into line with its its individual target, yielding a smaller increase. The difference is important.
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