Iran wants to avoid an oil price war with rival producers and only gradually lift exports once sanctions against it are lifted, a senior official said, in what would be a major shift away from planning to ship as much fuel as soon as possible.
Iran, which has some of the world’s biggest petroleum reserves, has repeatedly urged fellow OPEC members to make room for a supply jump from the nation, pledging to ramp up exports as soon as sanctions on its oil industry are lifted under a nuclear deal with world powers.
A move to limit export growth would be a major shift in Iran’s policies in an environment when most OPEC and non-OPEC producers are fighting for market share despite a growing global oil glut, which has already cut crude prices by two-thirds since 2014, hurting energy firms and oil exporting nations.
“We don’t want to start a sort of a price war,” National Iranian Oil Co international affairs director-general Mohsen Qamsari said by telephone.
“We will be more subtle in our approach and may gradually increase output,” Qamsari said. “I have to say that there is no room to push prices down any further, given the level where they are.”
He did not give any detail on how much Iran would be prepared to moderate a rise in its shipments, but said Iran would not offer further discounts to lure customers.
Iran now offers 90-day credit, free shipping and some discounts on crude prices to buyers in India.
The more cautious words from Iran come a week after relations with its main Middle East rival and top oil exporter Saudi Arabia broke down over the execution of a prominent Shiite cleric who was revered in Iran.
A more moderate re-entry into markets would suit Saudi Arabia and other Middle East OPEC members who are already locked into an aggressive fight for market share.
On Tuesday, Saudi Arabia signaled that the new rift would not affect talks on the Syrian civil war.
Iranian Oil Minister Bijan Zanganeh last weekend said Iran would not seek to distort the markets, but would make sure it regains its market share.
Iranian crude oil exports have fallen to about 1 million barrels per day, down from a peak of almost 3 million barrels per day in 2011, before Western sanctions against Tehran started.
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