OPEC Set To Reject Iran’s Plea For U.S. Sanctions Discussion

OPEC will probably reject Iran’s request to put the U.S. sanctions against Tehran up for discussion at the cartel’s official meeting later this month, a source familiar with the issue told Reuters on Friday.

Iran is seeking support from fellow OPEC members against the returning U.S. sanctions and wants the issue on the agenda at the Vienna meeting in June, Iranian Oil Minister Bijan Zangeneh wrote last week in a letter to Suhail Al Mazrouei, the energy minister of the United Arab Emirates (UAE) who holds the OPEC presidency this year and will be chairing the meeting.

In his letter, Bijan Zangeneh also suggested that his country does not agree with “recent remarks by certain OPEC members, noting that the Organization adopted decisions by consensus and no single member spoke for the body.”

Iran’s OPEC governor Hossein Kazempour Ardebili asked OPEC’s board chairman to include a debate on the sanctions in the June 22 talks, in a letter seen by Reuters and addressed to the UAE’s OPEC governor Ahmed al-Kaabi. The UAE governor consulted with a legal counsel who responded negatively to Iran’s request, because the agenda for the ministerial meeting had been finalized and couldn’t be amended, according to Reuters’ source.

In comments to Reuters on Friday, Iran’s Kazempour also harshly criticized a reported U.S. request to Saudi Arabia to help stabilize oil prices in case the sanctions against Iran push up prices.

“It’s crazy and astonishing to see instruction coming from Washington to Saudi to act and replace a shortfall of Iran’s export due to their Illegal sanction on Iran and Venezuela,” Kazempour said.

Venezuela, like Iran, has also sought support from OPEC against U.S. sanctions.

The two OPEC members under U.S. sanctions are currently the two key oil supply concerns globally that supported the oil price rally in recent weeks, before Saudi Arabia—Iran’s archrival—and Russia hinted at discussions that they were considering reversing some of the cuts to offset production losses and “ease market and consumer anxiety.”

If the partners in the production cut deal decide to raise production at the June meeting and if this move depresses oil prices, Iran and Venezuela have a lot to lose from lower oil revenues, because they can’t raise their respective production levels, also because of the U.S. sanctions. Due to disagreements over supply policy, the OPEC meeting later this month could be one of the worst and most contentious meetings in recent years, according to oil market analysts.