Iran to boost oil output to over 4 mil b/d

Iran said it planned to roughly double oil production in the next year, as the country anticipates a loosening of U.S. sanctions after Joe Biden becomes president.

Oil Minister Bijan Namdar Zanganeh told lawmakers on Saturday the government aims to pump 4.5 million barrels a day of oil and gas condensate, which is a liquid form of natural gas, during the next Iranian calendar year beginning on March 21, the state-run Islamic Republic News Agency reported.

Zanganeh also said Iran would increase oil exports to 2.3 million barrels a day provided that the U.S. eases sanctions on the energy sector, IRNA reported, citing Jafar Qaderi, a parliamentarian who sits on the budgetary affairs commission.

The projected exports are expected to cover 25% of Iran’s budget for the year ending March 2022, Qaderi said, a sign that the country’s economy is reducing its dependence on income from oil.

Iran’s oil production has almost halved to 1.9 million barrels a day since U.S. President Donald Trump withdrew from a nuclear deal with the Islamic Republic in 2018 and tightened sanctions.

According to data compiled by Bloomberg, exports, as high as 2.6 million barrels a day three years ago, have dropped to just 133,000. Almost all of Iran’s shipments go to China.

Extra exports from Iran would cause problems for OPEC+, which is trying to keep output down and bolster prices in the face of the coronavirus pandemic. While Iran is an OPEC+ member, the cartel has exempted it from production cuts due to the sanctions and its economic hardship.