On the one hand, the OPEC which is responsible for market regulation and specification of the production ceiling for the members, led the organization to widen its scope to cover the non-OPEC states. It encouraged convergence between the two wings of the oil market.
The goal of the meeting of the OPEC and non-OPEC was to cut the ongoing supply surplus in the market and subsequently, the producers would no longer have to cheap their oil at cheap price, refusing to put their wealth at the disposal of others at no cost.
When considering recent convergence among the OPEC and non-OPEC states, Iran's oil diplomacy should not be taken for granted. I believe, presence of Minister of Petroleum Bijan Zangeneh in the OPEC session helped the Organization regain its identity.
Mr. Zangeneh's OPEC experiences has helped him make the organization more efficient and fortunately, we did witness that contrary to other committed members, who had to cut their production ceiling, Iran's share rose by 90,000 barrels per day and this testifies the strength of Iran's oil diplomacy.
This should be taken as token of the prudence of Iranian Minister of Petroleum after to-the-point consultation and timely diplomacy.
Regarding the oil shocks in recent years, the scope of cooperation in the OPEC has become so wide and the decision helped restoration of stability to the market.
The OPEC and non-OPEC states can control the supply so as to achieve their targets provided that all adhere to their consensus and not to let politics interfere in their decisions.
Under present conditions, the favorable price for oil is 80 to 90 dollars which cannot be met in a short period of time.
By: Daryoush Ghanbar, Economic Expert
