Controversy has ensued on exemption of Nigeria and Libya from the ongoing oil production cut by the Organisation of the Petroleum Exporting Countries, OPEC and the non-OPEC producers. Iran insists both countries must join the cut for the agreement to be eff ective. According to Iran’s Oil Minister, Bijan Namdar Zanganeh on Monday, the group needs to address rising output from Nigeria and Libya. Compliance with the output cuts is “acceptable” but OPEC should focus on “the situation with Libya and Nigeria,” he said.
“OPEC’s actions are working and compliance is acceptable overall, although there needs to be some change,” Zanganeh said, referring to OPEC members’ compliance with their pledges to pump less. “Changes are really related to Libya and Nigeria and the 100 percent compliance of everyone.” OPEC and other global producers including Russia agreed to maintain output cuts through March 2018 to end a price retreat that has hit their economies since 2014. Iran was part of the deal reached last year, though it was given special permission to raise output by 90,000 barrels a day.
Libya and Nigeria were not part of the deal and have since increased production, but Nigeria’s output is still below the 1.8 million per day production offi cially granted it in July by OPEC. OPEC backs any action to help stabilise the oil market, and if a meeting is needed for the group to decide whether to extend the cuts that expire in March, “we’ll arrange it,” Zanganeh said.
Iran “will consider everything within the framework of our national interest and cooperation with OPEC,” he said when asked whether the country would adjust its output. On Sunday, Kuwait’s Oil Minister, Essam al-Marzouq, had said OPEC will not focus on just production data anymore, but would also look into export data of member countries in order to curb supply and further boost prices.
His statement came on the heels of agreement by OPEC officials during last weeks meeting that exports have a more direct impact on the international supply than production. Kachikwu said the country’s daily output is about an average of 1.69 million barrels per day, bpd. “Th e average is about 1.69 million bpd and it is getting better by the day,” Kachikwu told reporters in Vienna, where he attended the meeting of O P E C a n d n o n – O P E C ministers to review the ongoing production deal.