Eric Watkins
OGJ Oil Diplomacy Editor
LOS ANGELES, July 11 -- The Organization of Petroleum Exporting Countries is opposed to any increase in output ceilings in the absence of "well-studied justifications," according to Iran’s caretaker oil minister.
"Iran's policy as head of OPEC is to maintain the production ceiling of this organization," said Mohammad Aliabadi, adding, "It is an issue which a majority of OPEC members agree with." Iran currently holds the organization’s rotating presidency.
Aliabadi was referring to the vote by OPEC members at the group’s June 8 meeting in Vienna when Saudi Arabia, with support from three other members, proposed a boost in output by 1.5 million b/d to 30.3 million b/d.
The Saudi-led proposal was turned down by a majority of seven members—Libya, Algeria, Angola, Ecuador, Venezuela, Iraq, and Iran—who wanted to keep production unchanged. Nigeria remained neutral.
"Iran believes there is no shortage of supply," Aliabadi said at the time, adding that the view of the majority was that supplies were adequate for the time being and that it had proposed delaying a decision on more oil by 2-3 months.
Iran’s investment plan
Aliabadi’s statement this week came amid reports that Iran plans to invest $18 billion by 2015 to boost output in the south and that it expects the Yadavaran field to start production in a few months.
Most of the planned investment will be met by Iran, according to Deputy Oil Minister Mohsen Khojasteh Mehr, who said $3 billion will be spent by March 2012 on projects in the southern region.
"Many plans are being implemented to accelerate development of shared oil and gas fields while the ministry aims to increase oil production in the oil rich region of the south to 3 million b/d," Khojasteh Mehr said.
Yadavaran oil field, under development by Iran's National Oil Co. and China's Sinopec, will begin production this fall with 20,000 b/d and will reach 85,000 b/d over the next 2 years, Khojasteh Mehr said.
Meanwhile, in a report carried by the Tehran Times, the International Monetary Fund noted that total oil revenues of OPEC member states will surpass $1 trillion in 2011, with Iran earning $100 billion of the total. The aggregate oil income of the 12 members of OPEC reached $766 billion in 2010, according to the report.
Contact Eric Watkins at [email protected].
