Iran will emphasize regaining oil sales it lost due to sanctions over helping to prop up prices once curbs that choked off the nation’s crude exports are lifted.
The Persian Gulf producer plans to restore output to the level it achieved before the economic curbs crippled production and exports, Oil Minister Bijan Namdar Zanganeh said Monday in Tehran. Iran wants to pump almost 4 million barrels a day within seven months once sanctions are removed and 4.7 million as soon as possible after that, he said.
Such an increase may cause oil prices to fall, Zanganeh told reporters after meeting with Germany’s Vice Chancellor Sigmar Gabriel. “But that doesn’t mean we won’t enter our oil into the market.”
Iran had the second-biggest output in OPEC before the European Union banned purchases of its crude in July 2012. The country is now fourth-largest in the Organization of Petroleum Exporting Countries, with output in June averaging 2.85 million barrels a day compared with 3.6 million at the end of 2011, according to estimates compiled by Bloomberg.
Under the nuclear agreement Iran and six world powers reached in Vienna last week, the U.S. agreed to end efforts to limit Iran’s oil sales. The EU said it would end the bloc’s embargo on imports once Iran complies with obligations to scale back its nuclear program.
Brent crude, the global benchmark, fell about 50 percent last year amid surplus supply as the U.S., Russia and Saudi Arabia all boosted production. Oil lost 3 cents to $56.62 a barrel on the London-based ICE Futures Europe exchange at 12:51 p.m. Singapore time on Tuesday.
Countries that sold more oil and took market share from sanctions-bound Iran will have to adjust as the country restores its output and exports to historical levels, Zanganeh said, without identifying such nations. Production slid to 2.66 million a day by the end of 2012 after sanctions were tightened in July of that year, data compiled by Bloomberg show.
“Those who are responsible for protecting prices are those who have filled our share before and used it,” Zanganeh said. “Our only responsibility here is attaining our lost share of the market, not protecting prices.”
Iranian oil exports declined to 1.4 million barrels a day on average last year due to sanctions, the U.S. Energy Information Administration said June 24 on its website. Sales averaged about 2.6 million barrels daily in 2011, before the U.S. and European Union imposed restrictions, the EIA said.
Iran looks forward to doing more business with German oil and petrochemical companies, Zanganeh said. Issues preventing banks and insurers from involvement with Iran must be resolved before deals between the two countries can go ahead, he said.
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