Iran being OPEC’S third largest producer of crude oil has become one of the main barriers for a deal to increase the production of crude oil. While OPEC making attempts to sign an agreement on Friday regarding crude oil production has been threatened by Iran to block the move as it faces export-crippling US sanctions.
Saudi Arabia which is a real leader of OPEC’s and Russia have said for an increase in production supply of around 1 million barrels per day or we can say up to 1 percent of global supply had become a near-consensus proposal for the group and its allies. Sources have said that there will be a gathering in Vienna with The Organization of the Petroleum Exporting Countries and the major consumers like the United States, China, and India to cool down the price of crude oil and in fact to prevent crude oil shortage that could hurt the global economy as well.

In may regarding this, sanctions were even imposed by Trump whereas market watchers expected Iran’s output to fell down by one third until the end of this year. So basically country hasn’t much to gain from a deal to raise OPEC output.  Regarding this deal, Iranian Oil Minister Bijan Zanganeh also said on Thursday that he doesn’t think that there will be an agreement. Saudi Energy Minister Khalid al-Falih shared his views regarding the agreement and said that the majority of producers had asked for raising the output of crude oil by 1 million bpd and that too on a pro-rata basis.

A news says that OPEC and its supporters have been trying since last year to cut output by 1.8 million barrels per day. These actions by OPEC and its supporters have helped in maintaining the market in the past 18 months and provided a hike to crude oil of around $74 per barrel from as low as $27 in 2016. But recently due to unexpected outages in Venezuela, Libya and Angola have resulted in bringing down the crude oil supply to around 2.8 million bpd in recent months. Brent oil prices were up 1 percent on Friday.
“We want to prevent the shortage and the squeeze that we saw in 2007-2008,” Falih said, referring to a time when oil rallied close to $150 per barrel.
Earlier this week, Zanganeh offered a fair deal and said that OPEC members that had delivered the oil above the limits on cuts in recent months should comply with agreed quotas.