News / Energy

Iran refreshes pledge to boost oil output

Wednesday, 07 September 2016 5:52 PM [ Last Update: Wednesday, 07 September 2016 5:51 PM ]

Iran has renewed a promise to increase its oil production capacity to the levels that existed before sanctions were imposed against the country.

Iran has refreshed its pledge to increase its oil production to pre-sanctions levels within the next few months.

Mohsen Qamsari, the director for international affairs of the National Iranian Oil Company (NIOC), was quoted by the media as saying that Iran’s oil output had reached 3.8 million barrels per day and that it would increase production.

"Our current rate of production is slightly over 3.8 million barrels per day and before sanctions we were over 4 million," he said.

"And as everyone knows in the market, we are soon going to introduce new crude oil to the market by the end of the year, (that means increasing output) by at least 300,000 barrels a day so it means that we can match (our pre-sanction) production in two or three months," Qamsari told CBNC in an interview at a petroleum conference in Singapore hosted by S&P Global Platts.

The comments come after the world’s biggest crude oil producers Russia and Saudi Arabia announced on Monday that they would form a strategic energy partnership designed to help stabilize oil markets – a partnership which could envisage freezing oil output to help stabilize the prices.

Iran has so far rejected the call to freeze its output as unfair and emphasized that it will go ahead with its plans to increase its oil production.

Nevertheless, it had made it clear that it is ready to join the plan after its output reaches 4 million barrels per day.

The country had been under multiple years of sanctions that limited its oil exports to 1 million barrels per day and also barred foreign investments in its oil industry. The sanctions were lifted in January after a nuclear deal that Iran had reached with the so-called P5+1 group of countries – the five permanent members of the Security Council plus Germany – came into effect.

Qamsari told CNBC that and decision to freeze output was in the hands of the country's oil minister, Bijan Zangeneh.

"He has to decide. But based on his previous announcements, as soon as we can come back to the previous production (levels) before sanctions, we can think about that and discuss. Now we are almost close to that production level."

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