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Oil prices may surpass $50 if all producers agree: Iran's petroleum minister

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
Iranian Minister of Petroleum Bijan Zangeneh (L) and OPEC Secretary General Mohammed Sanusi Barkindo meet in Tehran on November 19, 2016. (Photo by Shana)

Iranian Minister of Petroleum Bijan Zangeneh has expressed optimism about an upcoming meeting of the Organization of the Petroleum Exporting Countries (OPEC) later this month, saying crude prices could surpass $50 a barrel if an agreement is reached.

“If we reach an agreement about the amount of oil production during the next OPEC meeting in Vienna, crude prices will immediately surpass 50 dollars a barrel,” Zangeneh told IRIB on Saturday after a meeting with OPEC Secretary General Mohammed Sanusi Barkindo in Tehran ahead of the 171st (Ordinary) OPEC meeting in the Austrian capital of Vienna on November 30.

He added that oil prices could jump to nearly 55 dollars a barrel if both OPEC and non-OPEC members cooperate.

"We are receiving positive signals that greatly increase the likelihood of reaching an agreement at the Vienna meeting … and I am very optimistic [about it]," the Iranian petroleum minister said.

He described as positive his talks with the OPEC chief in Tehran and said, “It is highly probable that the OPEC oil and energy ministers will reach an agreement during the November 30 meeting."

OPEC and non-OPEC member states seek to come up with a “comprehensive decision” in Vienna, Zangeneh said, adding that he had received promising information from the OPEC chief.

The Iranian minister expressed optimism about the upcoming developments in the oil market, saying, "Countries that had a higher amount of [oil] production in recent years, shoulder a heavier responsibility to improve the market situation.”

He emphasized that Western countries also expect higher oil prices to step out of recession.

In response to a question about fair oil prices, Zangeneh said an appropriate price should serve the interests of both oil producers and consumers.

He added that most OPEC member states support oil prices at between 55 dollars and 60 dollars per barrel.

Oil-exporting countries have been seeking a deal to cap production levels in an attempt to prevent a further drop in global oil prices, which in recent years has seen a fall from a high of 147 dollars a barrel to a low of around 25 dollars. Saudi Arabia, however, has repeatedly hindered such a deal by insisting that Iran agree to the same low production level as that assigned for other countries.

Iran has time and again said that it is prepared to join an oil freeze plan but has argued that any such deal should take into account the special position of the country, which had been under sanctions impacting its oil production levels for a number of years.

Iran has made it clear that it would join a deal to cap production levels only after its crude production and market share reach the pre-sanctions level. Russia, a major oil producer but a non-OPEC member, has supported Iran’s position.

Iran, which is OPEC’s third largest producer, has been ramping up crude oil output since a nuclear agreement, known as the Joint Comprehensive Plan of Action (JCPOA), between Tehran and the P5+1 group of countries went into effect on January 16, removing obstacles in the way of more crude production.

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