OPEC is more focused on identifying the right level of oil inventory at its next meeting than the impact on supplies of new US sanctions on Iran
Last week President Donald Trump announced that US would exit the Joint Comprehensive Plan of Action (JCPOA), an international deal with Iran established in 2015, and would impose sanctions on OPEC’s third-largest producer.
Commenting on oil supply worries because of the sanctions, Reuters reported that UAE Energy Minister Suhail bin Mohammed al-Mazroui, said “That’s not what we are concerned about now. What we are concerned about in the next (OPEC) meeting is what is the right level of inventory that we should see, and (how) can we put this group together for longer.”
OPEC has a self-imposed goal of bringing inventories in industrialised countries down to their five-year average and OPEC has said that the exporting group needs to identify that inventory target in June to gauge the success of the deal.
Prices on oil exports which have already risen this year following a global supply cut deal between OPEC and non-OPEC producers could see upward pressure in light of a decline on Iranian exports.
OPEC is set to meet in June to set oil policy together with non-OPEC producers participating in the supply cut deal, Reuters reported, adding that Mazroui said there was no reason to worry about supply, adding that this was not the first time an OPEC member had been in such a situation.