Only hours after news emerged that Iran has shipped its first oil cargo to Europe in multiple years as well as an announcement by Tehran that it has made a major rise in its oil production, indications emerged that key OPEC producers have become worried over the already deteriorating conditions in the oil market.
Nigeria announced on Sunday that it will soon discuss the new market conditions with Saudi Arabia and Qatar. The announcement was made by the Nigerian Oil Minister Emmanuel Ibe Kachiwku in an interview with Reuters.
“There’s increased conversation going on. I think when we met in December … they (OPEC members) were hardly talking to one another. Everyone was protecting their own positional logic,” said Kachiwku.
“Now I think you have cross-logic … they are looking at what are the deficiencies, what is the optimum.”
Iran said on Sunday that it has increased its oil production capacity by 400,000 barrels per day (bpd) thus moving closer to an earlier pledge to raise output by 500,000 bpd after the removal of the sanctions.
At the same time, the country said again on Sunday that it has shipped 4 million barrels of oil to France, Russia and Spain, the first delivery to European buyers since sanctions were lifted on the country.
Iranian officials had already emphasized that the country will proceed with an increase in its oil production in such a way as to prevent a fresh plunge in prices that have been nosediving over the past 18 months.
Nevertheless, they have emphasized that OPEC should accommodate Iran’s plans to regain its share of the market that it lost as a result of the sanctions.
Kachikwu told Reuters that he would meet his Qatari and Saudi counterparts next week to discuss the situation.
“Have we got to the point where we can say there is a definite strategy? In terms of production reduction or freezing, no, I don’t think we have got there. But there is a lot of energy (behind the idea),” he said.
“As you get closer to the statutory (OPEC) meeting dates … you are going to see a lot more people get active in those conversations and try to find solutions.”
OPEC’s next meeting is scheduled to be held in June.