The Iranian OPEC envoy must’ve been watching reruns of Star Trek all week. When asked to fall in line with the Saudi led production freeze, Mehdi Asali gave zero fucks, saying the Iranian government would keep jacking up production until it hit pre-sanction levels. This statement, and the mere presence of Iran, most likely infuriated the Saudis to no end. I bet they went to sleep tonight without even visiting the harem.
But Iran’s Mr Asali said to Shargh: “Asking Iran to freeze its oil production level is illogical… when Iran was under sanctions, some countries raised their output and they caused the drop in oil prices.
“How can they expect Iran to co-operate now and pay the price?”
It aims to raise its crude production and exports to one million barrels a day over the next six months.
Two non-Iranian sources close to the Opec discussions told Reuters that Iran could be offered special terms as part of the output freeze deal.
WTI crude is basically flat, at $28.95.
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I hope there will be a world economic system left, once Iran and Saudi finish fighting over whether oil companies– and the huge banks that buy oil company debt securities– are all going to go bankrupt or not.
But I still believe that Saudi putting a freeze on their oil production will put a floor under oil. I still think oil has bottomed or is near a bottom, and that Tepper will be fine. But with such an oil glut, I can’t see oil rising back up to its previous highs any time soon.