OPEC braces for tough Vienna talks on hiking oil output

OPEC ministers arrived in Vienna today for crunch talks on whether to reverse a landmark pact curbing oil output, with Iran pushing back against Saudi and Russian calls to ramp up production again.

The upcoming June 22-23 meetings of OPEC and non-OPEC energy ministers are set to be the most contentious in a while, with several countries bristling at the thought of reversing a deal that has been in place for 18 months and helped lift oil prices to multi-year highs.

Resistance is being led by Iran, deeply wary of any move by regional rival Saudi Arabia that could push down oil prices at a time when Tehran faces renewed sanctions following US President Donald Trump’s decision to quit its international nuclear deal, which is likely to impact the country’s oil exports.

However, Riyadh, which cheered Washington’s exit from the nuclear deal, is under pressure from its US ally to boost output as Trump hopes to keep pump prices low ahead of November’s mid-term elections.

“You’re dealing with a very political situation,” analyst Amrita Sen of Energy Aspects told AFP.

Upon arriving at his Vienna hotel, Iran’s oil minister said his country wouldn’t back down, and lashed out at Trump for trying to politicise OPEC. “I don’t believe in this meeting we can reach agreement,” Bijan Namdar Zanganeh told reporters.

He said Trump was partly to blame for the higher oil prices, saying the US leader had “created difficulty for the oil market” by imposing sanctions on Venezuela and Iran.

“And now he expects OPEC to change something for better prices,” Zanganeh said. “This is not fair… OPEC is not part of the Department of Energy of the United States.