Iran calls on OPEC to unite against possible US sanctions

Iranian President Masoud Pezeshkian has called on the other member states of the OPEC cartel to stand together and respond jointly to possible US sanctions against Iran. US President Donald Trump has said that his goal is to reduce Iranian exports to zero, in order to limit Iran’s financial resources for developing nuclear weapons or financing Iranian “terrorism” in the region.

Iranian oil exports currently stand at around 1.5 million barrels per day (bpd), with China being the main buyer of Iranian oil. Export volumes account for approximately 1.4% of global supply, as reported by Reuters. The loss of exports of this scale would therefore put upward pressure on wholesale oil prices.

“I believe that if OPEC members are united and cooperate, the US will not be able to sanction and put pressure on one of them,” Pezeshkian said at a meeting with OPEC Secretary General Al Ghais, according to Iranian state media.

Donald Trump had already indicated during his presidential campaign that he would exert maximum pressure to prevent Iran from obtaining an atomic bomb, including through reducing Iranian oil exports. Iran’s oil exports reached their highest level since 2018 at the end of Joe Biden’s presidency, despite sanctions against Iran remaining in force throughout his presidency. These had previously been imposed by Donald Trump.

And it was during his first presidency that Donald Trump managed, through sanctions and pressure on buyers, to reduce Iranian exports to as little as 200,000 bpd in some months of 2020. It should be added that 2020 was significantly affected by COVID-19, which resulted in an oil surplus on the market and created favourable conditions for this. Even before the outbreak of the pandemic, however, in 2018 other members of the OPEC cartel and its allies agreed to increase their production to cover the loss of Iranian supply.