US Action Could Wreck Iran’s Oil Recovery

摘要

Uncertainty is a feature of doing business in Iran. That’s a given. But the prospect of the US pulling out of Tehran’s nuclear deal with six world powers is making it a whole lot worse. If sanctions are restored in almost any form, it will simply make life more difficult for everyone. Having emerged from isolation, Iran’s political and economic gains since the lifting of nuclear-related sanctions in January 2016 would be in jeopardy. The biggest risks for Opec’s third-largest producer are a reversal of the recent recovery of crude oil exports, and a collapse of its drive to secure billions of dollars of new foreign investment, for its dilapidated oil and gas sector in particular. For oil traders and prospective foreign investors, any “snapback” to fuller US sanctions-some of which still constrain their financial transactions-would revive complex compliance issues (PIW Sep.25’17). Iran has managed to ramp up crude production to around 3.85 million barrels per day from around 2.8 million b/d in 2015 and sustained oil exports of 2.1 million-2.3 million b/d over the first nine months of this year. At around 1 million b/d, sales to Europe are back to where they stood before EU, UN and US sanctions were tightened between 2010 and 2012 (PIW Sep.11’17). Big ticket oil deals with international oil companies have been limited to a proposed $4.9 billion investment in offshore gas by a Total-led consortium, but Iranian Oil Minister Bijan Zangeneh says Tehran hopes to conclude 10 oil and gas deals by March. Royal Dutch Shell is said to be keen on the Azadegan oil field (PIW Sep.4’17).