OPEC Welcomes Iran's Return to International Oil Market

In a recent interview in Tehran, OPEC Secretary-General Haisam Ghaith expressed the organization's willingness to welcome Iran back to the international oil market if sanctions against the country are lifted. Ghaith highlighted Iran's significance as a founding member of OPEC and a key participant in the global oil market. Currently, Iran's oil production is limited due to sanctions imposed upon it.

Iran holds one of the world's largest oil reserves, estimated at over 200 billion barrels. However, its oil production capacity has been hampered by the impact of US sanctions over an extended period. The tightening of US sanctions against Iran since 2018 has further constrained Iran's oil production capabilities.

Ghaith added, "We are aware that Iran has the potential to achieve significant production levels in a short period, as demonstrated during the lifting of sanctions between 2015 and 2016. I believe Iran has successfully increased its total crude and condensate production to the level of 1 million barrels per day."

Ghaith, who assumed the position of OPEC Secretary-General in August of last year, previously served as a senior executive at the Kuwait Petroleum Corporation (KPC) and lived in China for nearly four years as the head of the company's Beijing office. While Iran is geographically close to Kuwait, this marks Ghaith's first visit to the country.

Ghaith further revealed that Iran's Minister of Petroleum, Javad Oji, informed him of Iran's intention to continue investing in the petroleum sector, including upstream, downstream, and petrochemical industries. As a critical participant, Iran is expected to play a role in global oil supply alongside other member countries.

"We welcome Iran's production recovery after the lifting of sanctions, and we look forward to that day. The market is growing, and demand is continuously increasing. We believe that Iran, as a responsible participant among OPEC member countries, will engage in fruitful cooperation," stated Ghaith.

According to secondary data cited in OPEC's May Oil Market Report, Iran's daily oil production currently ranks around fourth or fifth within the organization, closely resembling Kuwait's production levels, but lagging behind Saudi Arabia, Iraq, and the United Arab Emirates.

It is worth noting that Iran recently appointed an ambassador to Saudi Arabia, marking the latest step in thawing years of strained relations and the resumption of diplomatic ties between the two countries.

During the interview, Ghaith was asked about the perception that the voluntary production cuts did not meet expectations. He responded, "As you know, there are numerous factors that influence oil prices. I can honestly tell you that within OPEC, we do not target a specific price level."

Ghaith emphasized that the global economy is still in a period of recovery and has not fully rebounded. Additionally, challenges such as banking issues, tightening monetary policies, and high debt faced by many major economies persist. However, the organization still forecasts a growth in oil demand of 23 million barrels per day for this year.

"In the context of the average levels of the past few years, this is a fairly robust figure," added Ghaith.