Venezuela still hopes for OPEC, non-OPEC deal as Iran oil output rises

ST PETERSBURG, Russia (Reuters) - Venezuelan oil minister Eulogio del Pino said on Thursday fellow OPEC member Iran would reach pre-sanction oil output levels by September, allowing a revival of talks on a global oil production freeze.

Venezuela's Oil Minister Eulogio del Pino attends a meeting with President Nicolas Maduro at Miraflores Palace in Caracas, in this handout picture provided by Miraflores Palace on January 6, 2016. REUTERS/Miraflores Palace/Handout via Reuters

Speaking to Reuters on the sidelines of Russia’s main economic forum in St. Petersburg, Del Pino said the freeze idea could be discussed at an informal meeting of OPEC and non-OPEC producers in Algeria in September.

He also said he would propose OPEC formally adopts a policy of “production ranges”, which would allow output of country members to fluctuate by a certain amount.

That would allow the organization not to go back to discussing the thorny issue of a production ceiling and individual production quotas, he said.

“We will have production ranges and will monitor them constantly. That would give flexibility to correct things real time,” he added.

Venezuela has suffered badly from the oil price collapse with its production declining as in many other producing countries. But del Pino said it was now recovering as recent rains have helped power production, which is essential for oil fields’ functioning.

“Venezuelan production is not out of control... Electricity supply restrictions have been removed today. Output is rising”.

Output would rise to 2.8 million barrels per day by the end of the year, he said.

Del Pino said current production stood at 2.7 million bpd, allowing the country to export 0.6 million to China, 0.4 million to India, 0.8-0.9 million to the United States and keep around 0.55 million bpd for local consumption.

He said Venezuela and China were constantly discussing credit lines and cooperation in the oil sector but declined to say whether the country was talking about changing terms on the credit lines it had obtained from Beijing in exchange for oil.

He also said talks were taking place with 2017 bond holders but declined to disclose details or confirm they had been offered a swap for a new debt.

Reporting by Dmitry Zhdannikov; editing by Adrian Croft