Sun Feb 14, 2016 12:18PM
Iran says it has increased its oil production by 400,000 barrels per day in what could be a landmark move in the country's oil industry after the removal of the sanctions.
Iran says it has increased its oil production by 400,000 barrels per day in what could be a landmark move in the country's oil industry after the removal of the sanctions.

Iran said on Sunday that it has increased its oil production capacity by 400,000 barrels per day (bpd) thus almost materializing an earlier pledge to raise output by 500,000 bpd after the removal of the sanctions.

 

The announcement was made by Rokneddin Javadi, the managing director of the National Iranian Oil Company (NIOC).

Javadi has been quoted by the media as saying that the necessary preparations are also being made to increase Iran’s oil output by a further 200,000 bpd.

The announcement came a day after NIOC said it is loading 4 million barrels of oil for shipment to France, Russia and Spain, the first delivery to European buyers since sanctions were lifted on the country. 

“Within 24 hours, four million barrels of Iran’s crude oil will be loaded on three tankers destined for Europe,” NIOC’s Javadi said on Saturday.

On Sunday, he said Iran’s first deliveries of oil to Europe after the removal of the sanctions had opened a new chapter in Iran’s oil industry.

The official further emphasized that Iran based on a deal with Total will sell a daily of 160,000-180,000 bpd of oil to the French energy major for a period of one year.

These developments come only weeks after Iran’s nuclear deal with six world powers – known as the Joint Comprehensive Plan of Action (JCPOA) – took effect and subsequently sanctions on Iran were lifted.

A central theme in the sanctions included strict bans on investments in Iran’s oil industry thus keeping the cash the country needed to increase its oil production.  The sanctions also barred international clients from buying Iran’s oil beyond a low ceiling of 1 million barrels per day. 

Iran’s Oil Minister Bijan Zangeneh had earlier emphasized that the country will increase its oil production by 500,000 bpd within a short period after the removal of the sanctions. This, he had said, will increase by a further 500,000 bpd in a later stage.

Also, Iran’s First Vice President Es’haq Jahangiri said on Saturday that Iran’s oil exports will reach 2 million bpd from the current level of around 1.3 million bpd during the next Iranian Persian calendar year (to start 21 March 2017).