OPEC is unlikely to reduce oil production at its June meeting 01.03.2016

OPEC is unlikely to decide to reduce oil production at its meeting in June, even though prices remain very low, as there will still be too early to judge the pace of production growth in Iran, according to sources of the organization.

In addition, OPEC countries want to see whether Russia will honor the agreement to freeze the production, the sources said.

Production lowering is not took into account , although the cessation of its growth is only the first step to restoring the balance of supply and demand in the market, said last week the oil minister of Saudi Arabia, Ali Al-Naimi.

"Maybe by the end of the year a decrease will be possible, when it becomes clear that Iran does maintain the declared volumes, but not in June", - said a source from one of the Middle Eastern OPEC members.

Saudi Arabia, Venezuela, Qatar and Russia agreed to maintain production at the level of January, when it was a record or near-record in Saudi Arabia and Russia, but Iran, ranking third in OPEC production, intends to raise it after the lifting of sanctions in January.

"None of the OPEC does not know what is happening on the Iranian oil fields, so Saudi Arabia wants to see what will actually happen", - said a source of one of the OPEC countries.

Iran said to OPEC, what in January it added 3.4 million barrels per day, but the evaluation of third party observers is much lower. According to analysts, the production and export for several months may grow by maximum 700 000 barrels per day, to 3.5 million. According to Iranian officials, the country has increased its production by 500 000 barrels per day from January.

Saudi Arabia and Russia did not put the agreement in compliance with the dependence on Iranian behavior. Russian Energy Minister Alexander Novak plans in March to go to Iran for talks on frozen production.

Saudi Arabia is also not sure that Russia will respect the obligation not to increase production. Prior to this the only time that Russia has agreed to cooperate with OPEC was in 2001, but instead of reducing, it increased its exports.

"Even if they promise to reduce production, they won’t make it, so it makes no sense to spend time to achieve a reduction of production.", - Said Naimi last week.

However, "In the end we will have to cut production", - said one of the representatives of the OPEC on condition of anonymity.