TEHRAN // Iranian President Hassan Rouhani has blamed the sharp fall in global oil prices on “treachery,” apparently referring to Saudi Arabia’s opposition to production cuts.
Oil prices have plunged by more than 40 per cent since June to less than US$70 (Dh257) a barrel, placing severe strain on Iran’s economy, which is already crippled by international sanctions imposed over its nuclear programme. The country’s 2014 budget is based on oil priced at around $100 (Dh367) a barrel.
An Opec meeting failed to reach an agreement on scaling back production last month, mainly because of Saudi opposition.
Speaking at a cabinet meeting on Wednesday, Mr Rouhani said that the fall in prices is at least partly “politically motivated,” and the result of a “conspiracy against the interests of the region, the Muslim people and the Muslim world.”
“Iran and people of the region will not forget such conspiracies, or in other words, treachery against the interests of the Muslim world,” he said.
Opec controls about 40 per cent of the global oil market and Saudi Arabia, which is the world’s largest oil exporter, produces nearly 10 million barrels a day – a third of the Opec total. Riyadh has thus far refused to go along with Iran, Russia, Nigeria and Venezuela over scaling back oil production to drive prices up.
The fall in prices has mainly been attributed to a US oil boom and lower world demand caused by weakened economies. Saudi Arabia is opposed to cutting production because it fears its market share could erode.
Saudi Arabia and Iran are long-time rivals who have been fiercely divided over the civil war in Syria, where Shiite Iran supports President Bashar Al Assad, while Saudi Arabia backs the mainly Sunni rebels fighting to topple him.
* Associated Press and Reuters