By Peyman Jonoubi.
Having found that its plan to freeze Iranian oil is not effective, Saudi Arabia directed Doha talks to failure. 18 oil producing states get together in Doha, Qatar, on April 17 to stabilize oil production at the level of January until October 2016 but the meeting failed.
The main reason for failure of the Doha meeting was lack of access of Saudi Arabia and its allies to the main goal, let’s say Iranian oil freeze. In fact, Saudi Arabia tried to bring Iran to a point where it had no option but accepting the status quo, thus using oil freeze as a lever to continue economic pressures on the country. Iran did not take part in the meeting so that those being responsible for today condition of the oil market will be freer to solve their behind-the-curtain problems.
On the topic, Minister of Petroleum Bijan Zanganeh said certain oil producers had since the beginning opposed lifting of Iran sanctions and they tried to lower the oil price just to pile up much pressure on Tehran. He says, “Now, there are more than two million barrels of oversupply in the market, which have caused plunger in oil prices.”
The Minister said countries imagined that through raising controversy among oil producers after lifting of Iran sanctions, they could divert public opinion from the issue that they themselves were factor of instability. He said Iran has had no role in the oil market instability.
Zanganeh believed that acceptance of the oil freeze project by Iran meant that our country will in fact bow voluntarily to the sanctions which were lifted practically after years of efforts and resistance of the nation. Zangeneh’s comments are fully logical regarding the record of Saudi Arabia.
Earlier in December 2011, when the 10th government was in office, the OPEC held an important meeting and in the conference Saudi Arabia presented a pre-meditated plan in a dastardly way to receive the permission to substitute its oil in markets for Iranian oil!
Since then, Iran accepted Saudi Arabia’s cunning plan, allowing compensation for production of any of the OPEC members through increase in production of other members to the ceiling of 30 million barrels per day. Having informed of severance of sanctions on Iran and entry of other G5+1 members to the new phase of oil sale sanctions in 2012, Saudi Arabia and certain other allies decided to divide Iran’s market quota among themselves.
They did know that since July 1, 2012, 27 EU members will suspend crude oil imports from Iran for further notice and hence, they should decide OPEC rationing and Iran share in the market six months prior to the time sanctions on Iran oil goes into effect.
After finalization of Iran-G5+1 agreement, which led to lifting of economic sanctions and annulment of the UN Security Council resolutions against Iran, the country managed to raise its oil exports to two million bpd from one million bpd in less than six months.
Following executive measures for implementation of the Joint Comprehensive Plan of Action (JCPOA) and return of Iranian oil to the global markets, senior delegations from many countries and the European, Asian and American industrial companies travelled to Iran to give an impetus to their economic and political ties with Iran.
Indians travelled to Iran to talk about the project for implementation of the gas pipeline project for export of the energy to their country. Pakistan will expedite its activities to start laying pipeline for Iran’s gas exports to Pakistan. The UAE is seriously in efforts to complete operations for export of Iran gas to the country. Turkey has started talks for increasing gas exports to the country. Europeans also want to import gas from Iran and invest in the petrochemical and other industrial projects.
In the meantime, Saudi Arabia is unbelievably witnessing regional developments and observes Iran’s moves of recourse to the international community and raising economic potential of the country.
Saudi Arabia and its supporters, who had in the past three decades tried to restrict Iran and downsize its economic power are today puzzled. They tried to meet the goal through helping Baathist regime and Daesh to create a critical region west of Iran, assisting Taliban to make Iranian eastern borders insecure, planning to escalate tension on Iranian northern borders and preventing improvement of relations with the Persian Gulf littoral states and planning for severance of sanctions on European Union and the US.
Adhering to the agreements reached in the JCPOA and contrary to expectations of Saudi Arabia and its supporters, Iran has been able to encourage such big international companies as Shell, Total, BP, Eni, Repsol, Statoil, Lukoil, Gazprom, Hinduja, Linde, BASF, Peugeot, Siemens, Boeing, Airbus, ARCA Insurance Service and so on to come to Iran from four corners of the world to expand investment in various industrial fields in Iran through help of foreign banks.
Iran has been able to amazingly raise its production and launch proper marketing for its oil, regaining part of its occupied markets, seeking further increase of its production and exports.
Iran has been able to show that as a key element, it can help growing stability in the region and there is no possibility for its omission from regional equations.
Definitely, should the status quo designed by government continue, Iran’s political and economic prospect will be clear and the more we step forward Saudi Arabia and its supporters will face more limits to win international support to continue economic and political blockade of the country.
So, Saudi Arabia will have to act more transparently!
For the first time in 2011 and six months prior to imposition of the oil embargo on Iran, Saudi Arabia and its supporters changed OPEC members’ quota based on the share each member had.
Second time in September 2014 and one year before elimination of oil embargo on Iran, they started the project of reducing oil price. But Iran managed to overcome the barrier too.
For the third time and after elimination of international sanctions on Iran, Saudi Arabia raised the issue of oil freeze and mandating Iran to contribute to the project so that it will be implemented.
Both the oil market and the world oil and economic experts do know that though non-durable production capacity of Saudi is 12 million barrels per day, the country’s output capacity will not allow it to go on with lasting production of more than 10.5 bpd in a period of more than three to six months.
Regarding low prices of oil and inability for investment and oil production surplus, other oil producers are not only incapable of preserving current production, but also talks on increase in the production by the countries seems more to be a joke.
Principally, due to the same reason, Saudi Arabia proposed production of oil from al-Khafaji oil field common with Kuwait and prices have also started going upward.
