• 1 hour Nigeria Files Suit Against JPMorgan Over Oil Field Sale
  • 8 hours Chinese Oil Ships Found Violating UN Sanctions On North Korea
  • 13 hours Oil Slick From Iranian Tanker Explosion Is Now The Size Of Paris
  • 17 hours Nigeria Approves Petroleum Industry Bill After 17 Long Years
  • 19 hours Venezuelan Output Drops To 28-Year Low In 2017
  • 21 hours OPEC Revises Up Non-OPEC Production Estimates For 2018
  • 1 day Iraq Ready To Sign Deal With BP For Kirkuk Fields
  • 1 day Kinder Morgan Delays Trans Mountain Launch Again
  • 1 day Shell Inks Another Solar Deal
  • 2 days API Reports Seventh Large Crude Draw In Seven Weeks
  • 2 days Maduro’s Advisors Recommend Selling Petro At Steep 60% Discount
  • 2 days EIA: Shale Oil Output To Rise By 1.8 Million Bpd Through Q1 2019
  • 2 days IEA: Don’t Expect Much Oil From Arctic National Wildlife Refuge Before 2030
  • 2 days Minister Says Norway Must Prepare For Arctic Oil Race With Russia
  • 2 days Eight Years Late—UK Hinkley Point C To Be In Service By 2025
  • 2 days Sunk Iranian Oil Tanker Leave Behind Two Slicks
  • 2 days Saudi Arabia Shuns UBS, BofA As Aramco IPO Coordinators
  • 2 days WCS-WTI Spread Narrows As Exports-By-Rail Pick Up
  • 3 days Norway Grants Record 75 New Offshore Exploration Leases
  • 3 days China’s Growing Appetite For Renewables
  • 3 days Chevron To Resume Drilling In Kurdistan
  • 3 days India Boosts Oil, Gas Resource Estimate Ahead Of Bidding Round
  • 3 days India’s Reliance Boosts Export Refinery Capacity By 30%
  • 3 days Nigeria Among Worst Performers In Electricity Supply
  • 3 days ELN Attacks Another Colombian Pipeline As Ceasefire Ceases
  • 4 days Shell Buys 43.8% Stake In Silicon Ranch Solar
  • 4 days Saudis To Award Nuclear Power Contracts In December
  • 4 days Shell Approves Its First North Sea Oil Project In Six Years
  • 4 days China Unlikely To Maintain Record Oil Product Exports
  • 4 days Australia Solar Power Additions Hit Record In 2017
  • 4 days Morocco Prepares $4.6B Gas Project Tender
  • 4 days Iranian Oil Tanker Sinks After Second Explosion
  • 7 days Russia To Discuss Possible Exit From OPEC Deal
  • 7 days Iranian Oil Tanker Drifts Into Japanese Waters As Fires Rage On
  • 7 days Kenya Cuts Share Of Oil Revenues To Local Communities
  • 7 days IEA: $65-70 Oil Could Cause Surge In U.S. Shale Production
  • 7 days Russia’s Lukoil May Sell 20% In Oil Trader Litasco
  • 7 days Falling Chinese Oil Imports Weigh On Prices
  • 7 days Shell Considers Buying Dutch Green Energy Supplier
  • 8 days Wind And Solar Prices Continue To Fall
Daniel J. Graeber

Daniel J. Graeber

Daniel Graeber is a writer and political analyst based in Michigan. His work on matters related to the geopolitical aspects of the global energy sector,…

More Info

Sanctions Impact Peaks for Iran

Sanctions Impact Peaks for Iran

The Iranian oil sector may be lagging because of declining revenue needed to keep the domestic sector afloat.  The country was hit with economic sanctions during the summer amid growing concerns over its nuclear ambitions and OPEC figures show a general decline in crude oil production from the Islamic republic. U.S. energy statistics, meanwhile, predict Iran's crude oil production should fall more than 20 percent compared to last year's figures. From the Iranian perspective, however, all is well for No. 3 among OPEC nations.

Iranian Oil Minister Rostam Qasemi said neither crude oil sales nor production is impacted by sanctions imposed by Western governments. The U.S. and European governments during the summer targeted the country's energy sector as punishment for transparency issues with nuclear research. This week's annual meeting for the U.N. General Assembly brought Iran's behavior in the global community to the center stage given nuclear concerns and Tehran's allegiance to the Syrian government. Nevertheless, U.S. Secretary of State Hillary Clinton had provided leeway to some key U.S. allies. Despite a damning assessment from the International Atomic Energy Agency, Clinton said some countries would be shielded from sanctions for making "significant" cuts in crude oil purchases from Iran.

"I am pleased to announce that Belgium, the Czech Republic, France, Germany, Greece, Italy, Japan, the Netherlands, Poland, Spain, and the United Kingdom have again qualified for an exception to sanctions … based on reductions in the volume of their crude oil purchases from Iran," she said in a statement.

That protection allows those countries to continue making some crude oil purchases from Iran so long as the "significant" threshold is respected. Iran produced around 3.5 million barrels of oil per day last year, before sanctions honed in on the country's energy sector. The U.S. Energy Department's Energy Information Administration, however, expects production to fall to 2.7 million bpd this year and another 200,000 in 2013. Using information collected for the CIA's World Fact Book, that decline could theoretically knock Iran out of the Top 10 in terms of yearly crude oil production.

Qasemi, however, said sanctions weren't impacting the country's oil sector in the way Western governments had expected. Oil production in the Islamic republic for this year, he said, should remain at about the same level as for 2011. Using OPEC's figures, Iran has so far averaged around 2.9 million bpd, in line with EIA expectations. The minister said Iran's supplier base remained intact, however.

"Iran's crude is being supplied on the world markets and Iran has its traditional buyers," he said.

Despite the pressure, however, Iran is keeping some of its market activity going. Given Clinton's acceptance that at least some of Iran's oil is needed to keep markets moving, it's unlikely that Tehran would stay out of the Top 10. The global economy last year was squeezed when Libya, No. 15 based on CIA production figures, was shut out by war. Though concerns over Iran's nuclear activity are warranted, it appears that current sanctions on oil have reached the high-water water mark in terms of effectiveness.

"Sanctions, when we look at history, rarely work," argued U.S. Sen. John McCain.

By. Daniel J. Graeber of Oilprice.com




Back to homepage


Leave a comment
  • Philip on October 01 2012 said:
    There is just so much propaganda out there aroun Iran, just so much disinformation from every conceivable source that it is well nigh impossible for anyone to have a clear picture of the Iranian economic reality except for Iranians themslves. Everyone is guessing anmd second guessing, and so many are being paid to produce propaganda.

    The consequence is that the only reliable indicator of what is happening in and to Iran is how Iran is actually responding to global events. And thius far Iran does not seem to be unduly affected by any of the measures being taken against her.

    She has China, India and other Asian Pacific countries continuing to buy oil from her. Europe only accounts for about 20% of her exports.

    I think we need to be very sober in assessing Iran and to reverse our considerations of her. It would be appear far more likely that Iran is the rational actor in this high drama and that it is thre US and Israel who are increasingly running out of realistic options to manage Iran.

    Iran is no worse than Pakistan or Israel in having a nuclear potential. It is Israel that irrationally favours striking because Iran has been gradually boxing Israel into a corner since 1979. Israel has no way out of that corner. All this nonsense about Iran striking Israel - does anyone seriously believe that Iran wants to irradiate Palestine for 500,000 years with a nuclear strike and to thraten Islam's 3rd holiest sacred shrine at Jerusalem?

    Even the US has increasingly limited options. So everyone is playingbthe propaganda game. And eveyone is becoming increasingly more confused and perplexed by the blurring of thr distinction between propaganda and reality.

    This is a situation entirely of the West's own making. A last attempt by an increasingly defunct Western system to push back the rising tide of the Asian Pacific region and its ME resource providers. The last 10 years of war have demonstrated how the West has effectively shot its bolt and must now await the consequences this 'Shift to the East', militarily, economically and above all psychologically.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News