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Iran boasts of post-sanctions oil performance

Country's oil minister said exports are now in the 2 million bpd range.

By Daniel J. Graeber
Iran boasts of post-sanctions oil performance
Iran says its exports and production of crude oil are at or near where they were before sanctions were enacted to curb the country's nuclear ambitions. Photo by William S. Stevens/U.S. Navy/UPI | License Photo

TEHRAN, June 14 (UPI) -- With Iranian crude oil production moving past what it was during the sanctions era, the government said it was now looking to ensure a strong market position.

Iranian crude oil production stands at around 3.8 million barrels per day and exports are on the rise.

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"Iran is now exporting more than 2 million barrels per day of crude oil," Iranian Oil Minister Bijan Zangeneh told the oil ministry's news website SHANA.

Mohsen Qamsari, the director of international affairs for the National Iranian Oil Co., said this week that Royal Dutch Shell was now among the first companies to buy Iranian crude oil in the post-sanctions era. About 130,000 tons, or roughly 953,000 barrels, of oil may be loaded for Shell at a terminal on the Persian Gulf.

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Exports from Iran averaged around 1.4 million bpd last year. Before sanctions were imposed in 2011, the export average was around 2.6 million bpd, with most of that headed to the Asian market.

According to the Organization of Petroleum Exporting Countries, Iran reported crude oil production for May averaged 3.6 million bpd, up 2.8 percent from the previous month and 16 percent higher than during 2014.

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Iranian crude oil production held steady at around 2.7 million bpd from December 2011, when nuclear-related sanctions were enacted, to January 2016, when a multilateral agreement to curb nuclear work was implemented.

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An estimate from the U.S. Energy Information Administration drafted in January said Iranian crude oil production would average 3.3 million bpd by the end of this year and hit 3.7 million bpd by the end of 2017.

OPEC ministers met in early June in Vienna for their first general meeting since a proposal to freeze production at January levels collapsed when Iran said it would consider similar market control measures only after it regained the leverage it lost to sanctions. The freeze proposal was considered as an option to help push markets closer to balance following at least two years of supply-side pressures.

Iranian government spokesman Mohammad Bagher Nobakht said it's within the nation's rights to ensure a larger market share now that sanctions pressures are easing. Though more Iranian crude oil on the market would in theory add to supply-side strains, the oil minister said earlier this month that Iran's return had already been factored in at the global level.

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