HomeMediaLatest NewsThe Iranian oil trick: there are sanctions, but production and exports are growing

The Iranian oil trick: there are sanctions, but production and exports are growing

28 July 2023

Belogoryev Alexey M. Research and Development Director, Director of the Center for Energy strategic analysis and forecasting

Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented to the Oil and Capital magazine about the reasons for the growth of Iranian oil exports under international sanctions.

Alexey Belogoryev explained why there were no fewer sanctions, and Iran's exports and production are growing.

"Firstly, the consumption of black gold is growing rapidly in Iran, primarily for the needs of oil and gas chemistry. Tehran was able to implement an export-oriented strategy of oil and gas chemical production, and a very wide range of goods, very quickly in a short time. This has become one of the reasons, why production is growing in the country.

Secondly, by the beginning of 2022, Iran had accumulated large oil reserves, both on land and in tankers, which is why we see that exports sometimes even grew faster than production. Now Tehran's reserves have decreased, but they are still at a very high level, which means there is an opportunity to sell more oil than usual," the expert says.

As Alexey Belogoryev stressed, Iran is still far from the export figures that were in 2016. The sanctions that are in effect now create problems for the industry, and the difficulties with underfunding exploration and technical difficulties to increase production have not disappeared anywhere. However, there is still a tendency to increase production and exports.

"Although there is no strong easing of sanctions by the United States, Washington, despite the new restrictions, still turns a blind eye at many movements of the Iranian oil industry after the beginning of 2022. Their observance is carried out with a high degree of connivance, however, as in relation to Venezuela. When the US leadership initiated restrictions against oil exports from Russia, oil from Iran and Venezuela became something of a substitute in certain markets, so they have not been trying so hard to stop it in the last 1.5 years", the expert shared his opinion.

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