Iran has asked for an emergency Opec meeting because of the recent fall in oil prices. Opec members agreed to hold an emergency meeting when they last met in on 14 June in Vienna if oil prices fell below $100/bl, the Iranian oil ministry news service Shana quoted Iran's oil minister Rostam Qasemi.
Opec countries agreed to adhere to the previous 30mn b/d production level at the Vienna meeting, pledging to cut back on 1.6mn b/d of overproduction. Failure by Opec members to abide by their quotas will result in further falling prices, Qasemi said.
Saudi Arabia and Iran have in recent years disagreed about how much Opec needs to supply. Saudi Arabia, which has closer ties with major consumers in the west, has been keen to pump more oil as prices surged above $100/bl and the US and Europe struggled with economic difficulties. But Iran has argued that their economic crises are likely to lead to lower demand and that Opec should not produce more than its agreed production ceiling.
The two countries and regional rivals are also engaged in a geopolitical struggle, with US-ally Saudi Arabia emphasising its readiness to meet any market supply shortfall, as the US and EU pushed ahead with tougher economic sanctions to isolate Iran's oil industry.
These sanctions have failed to prevent Iranian oil from reaching its customers, Qasemi said, with Tehran possessing plans to deal with every eventuality created by the sanctions. Iran had received interest from new customers, Qasemi said, entering into negotiations with some of them since halting 18pc of its exports that are sold to Europe.
The EU's ban on Iranian oil imports, which took effect yesterday, also extends a ban on insurance cover for tankers carrying Iranian crude and oil products. This has a major impact on importers outside the EU as liability insurance issued by protection and indemnity mutual insurers is centred in the EU.