Iran says OPEC has 'not much credit' left

TEHRAN: Oil cartel OPEC has “not much credit” left as some members are turning it into “a tool for the US”, a senior Iranian official said in comments published on Saturday.

“Saudi Arabia and the UAE are turning OPEC into a tool for the US and consequently the organisation has not much credit left,” Iran’s OPEC governor Hossein Kazempour Ardebili told the Shana newswire, affiliated to Iran’s Oil Ministry.

“It is a fact that OPEC is losing its organisational character and becoming a forum,” he added.

In a move heavily opposed by Iran, OPEC and other oil producers including Russia agreed in June to boost crude output by around a million barrels a day, reversing course after supply cuts that had cleared a global glut and boosted prices.

Iran, a founding member of the cartel, had been against the move which came as the country faces renewed US sanctions after Washington’s decision to leave the 2015 nuclear deal between Tehran and world powers.

The US decision had stoked supply concerns on world markets.

Ardebili also accused Saudi Arabia and Russia of taking the market “hostage” through increased production and said that OPEC’s responsibility is to restore market balance, not to boycott its founding members.

US President Donald Trump has repeatedly urged the cartel to raise its production and said that other countries must stop buying oil from Iran or face US sanctions.

Meanwhile, output from Iran has hit its lowest level since July 2016 as top buyers India and China distance themselves from Tehran due to looming US sanctions on November 5, according to the International Energy Agency.