OPEC: Iran's Oil Production Has Fallen by One Million Barrels in the Past Year

The Organization of the Petroleum Exporting Countries (OPEC) stated in its latest report published on Thursday, January 17, that Iran's oil production in December decreased by 159,000 barrels compared to the previous month and by approximately one million and 50,000 barrels compared to the average production in 2017. The report estimates Iran's production in December at 2,769,000 barrels, which is even lower than Iran's oil production in December 2015, before the lifting of Western sanctions. Western sanctions against Iran were lifted in January 2016, but the U.S. withdrew from the JCPOA on May 8 this year and reinstated oil sanctions against Iran in November. The U.S. granted exemptions to eight countries for six months to buy limited amounts of oil from Iran, but the U.S. Energy Information Administration reported on Wednesday that its current assessment is that the U.S. will not extend the exemptions for the Islamic Republic's oil customers. Brian Hook, the U.S. Special Representative for Iran, recently announced that in May, the U.S. would not extend the exemptions for Iranian oil buyers. The U.S. Energy Information Administration estimates Iran's oil exports in December at 'about one million barrels.' Meanwhile, President Hassan Rouhani's government has predicted a daily sale of 1,540,000 barrels of crude oil in the next solar year's budget bill. OPEC also states that the price of Iran's exported oil in December fell by nearly 13% compared to November, dropping below $55. Iran has forecast its oil price at $54 in the next year's budget. The U.S. Energy Information Administration predicts that in 2019, the average price of Brent crude oil, which is a few dollars more expensive than Iranian oil, will be around $61. The OPEC report indicates that the total production of the organization in December decreased by 751,000 barrels compared to the previous month, with Saudi Arabia accounting for about 60% of this decline. The report adds that global oil demand is expected to increase by 1.29 million barrels this year, surpassing 100 million barrels for the first time. In terms of supply, production from non-OPEC countries is expected to increase by about 2.1 million barrels, thus the need for OPEC oil this year will be 900,000 barrels less than in 2018. The U.S. Energy Information Administration's report also indicates that at best, the average production of 'excess oil' globally in 2019 is expected to be about 200,000 barrels per day, and this figure will double in 2020.