Iran can add million barrels of oil a day if sanctions halt

ANGELINA RASCOUET and HASHEM KALANTARI

LONDON (Bloomberg) -- Iran could raise oil exports by 1 MMbopd without international sanctions, its oil minister said as talks resumed with the U.S. over the nation’s nuclear program.

“If sanctions are lifted, we can raise our exports by 1 MMbopd within a few months,” Oil Minister Bijan Namdar Zanganeh said Monday in Assaluyeh, Iran. The country shipped 1.2 MMbopd last month, the International Energy Agency said in a March 13 report.

Iran and six world powers are negotiating an agreement to end a decade-long dispute over the Persian Gulf country’s nuclear program. Diplomats from the U.S. and Iran, working toward an end-of-March deadline, resumed talks on Monday in Lausanne, Switzerland.

“If we get an announcement of a framework deal within the next couple of weeks, obviously from a market psychology, we’re going to have a bearish knee-jerk reaction,” said Mike Wittner, the head of oil market research in New York for Societe Generale SA. It’s unclear when sanctions might end and it would take six months to a year for Iran to add a million barrels a day, he said.

Brent crude, the global benchmark, plunged by 61% in the seven months through mid-January because of concern about oversupply. Brent for May settlement fell 42 cents, or 0.8%, to $53.52/bbl on the London-based ICE Futures Europe exchange at 8:47 a.m. local time. West Texas Intermediate lost 49 cents $43.39 on the New York Mercantile Exchange.

Iran is the fifth-largest producer in the Organization of Petroleum Exporting Countries, pumping 2.78 MMbopd in February, according to data compiled by Bloomberg.

“It may be that Iran simply can’t say yes to the kind of deal that the international community is looking for,” U.S. Secretary of State John Kerry said at the weekend.