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Authorities in Iran have been urged to press for an emergency Opec meeting due the falling crude prices.
Iranian officials have pointed their finger at Saudi Arabia, saying it had deliberately kept prices low by manipulating Opec sales. Iran’s oil minister, Bijan Zanganeh, has been threatened with a parliament hearing to explain his approach.
Zanganeh implicitly blamed Riyadh for the situation. “Some of the biggest producers at Opec should reduce their sales,” he said, in what was widely viewed as a criticism of Saudi Arabia.
Other Iranian officials have been more candid with their views about Saudis. Masoud Mirkazemi, a former Iranian oil minister but now an MP, has threatened to summon Zanganeh to the parliament for his “passive” response to the falling oil prices.
Mirkazemi has accused the Saudis of conducting a political game and acting against the interests of Opec members.
“We should have an emergency Opec meeting so that countries like Saudi Arabia that pursue policies against producers’ interests would reduce their sale,” the ex-minister said, according to the conservative Tasnim news agency.
“Saudi Arabia, which intends to manage the Opec, serves the interests of the G20 group. We should not let Saudi Arabia to do this and our oil ministry should change its passive response to the issue,” he said.
Iran’s economy, which depends on oil for most of its exports revenue, has faced huge economic problems in recent years due to international sanctions imposed over Tehran’s nuclear programme.
An EU and US oil embargo, strict banking restrictions and trade bans have been among the major measures designed to punish Tehran for its failure to comply with international demands over its nuclear activities.
Falling oil prices will just add to economic woes in a country with the world’s fourth largest oil reserves.
Amir Handjani, of the Dubai-based RAK Petroleum, said that since the west struck an interim nuclear agreement with Iran last November, Tehran has increased crude sales in order to purchase essential commodities and goods.
In 2010, he said, Iran was the fourth largest producer of Opec, whereas today it stands in the eight place.
“Iran has been very lucky that in the past eight years oil prices were so high,” Handjani, who was one of the speakers at the London EU-Iran Forum on Wednesday, told the Guardian.
“But now oil prices are coming down and given the fact that Tehran is already under sanctions, the issue of falling oil prices is going to be very sensitive.”
He said it was difficult to predict what would happen if prices continued to drop but said it will certainly have an impact on the country’s economy.
“No one can predict the future but if you go back to 1998 when the price of oil was 10 dollars per barrel then yes, falling prices today can be catastrophic.”
Marie-Claire Aoun, the director of the centre for energy at French Institute of International Relations (IFRI) said the capacity of Opec would determine how the current declining trend will continue.
“Whether there’s going to be a catastrophe or not wholly depends on how Opec is going to deal with it,” she told the Guardian.
