Iranian website says oil revenue rises with or without nuclear deal
Iran will earn $36 billion from oil exports in 2022, mostly to China, the Revolutionary Guards-affiliated Fars news site reported on Sunday.
In an article claiming that Iran can win as much bypassing US sanctions as he would if he signed a nuclear deal to lift those sanctions, the website compares annual oil revenues during former President Hassan Rouhani’s two terms, with the administration 11 months of current President Ebrahim Raisi.
He argues that during Rouhani (2013-2021), when the Joint Comprehensive Plan of Action (JCPOA) was signed with world powers in 2015, the average annual oil export revenue was $37.5 billion, but it had fallen significantly since 2018, when President Donald Trump stepped out. the agreement and imposed oil sanctions.
However, exports picked up again in 2021, the website says, trying to give the hard-liners Raisi administration credit.
Exports had already started to rise by the time of the 2020 US presidential elections and increased further when the Biden administration decided to launch talks to revive the JCPOA and did not rigorously enforce Trump-era sanctions.
The article attempts to argue that failing to reach an agreement with the United States will make no difference in oil exports and that Iran can increase its revenue to $50 billion. But he conveniently fails to mention that most of the recent gains claimed are due to higher oil prices, not export volumes.
President Raisi seen praying during a parliament meeting on April 18, 2022
Without sanctions, Iran’s oil revenue would at least double, as it would export at least two million barrels a day instead of shipments currently estimated at less than one million. Nor would the country be forced to offer a rebate of $20 to $30 per barrel and spend more money marketing the sanctioned oil. It is well known that various intermediaries and brokers make large profits by disguising shipments from Iran.
It is beyond doubt thatOil shipments and profits from Iran have increased since November 2020, as Fars also shows in his report, but the amount of revenue can be guessed. The rebate offered by Iran and the profits it is to share with intermediaries remain secret. Additionally, some observers believe that China does not pay for all the rough it receives in cash, and some is reimbursed in kind, along with shipments of other goods.
The indirect proof is deterioration of the financial situation of the Raisi administrationwhile the practice of paying salaries late continues in a 50% inflation rate and the national currency has fallen to an all-time low.
Raisi was forced to scrap a $15 annual food import subsidy in early May, leading to a huge price spike, leading to protests and political instability.
Iran ships most illicit crude to China, offering steep discounts, especially as Russia came under sanctions after invading Ukraine in February and began shipping its unsold oil to China as well. Reports in early June said Iran’s exports to China had halved in May due to Russian competition.
The latest round of talks to resolve differences with Washington and finalize the relaunch of the JCPOA failed this week in Doha. The United States has accused Iran of introducing “foreign” issues into the talks and of remaining undecided on fundamental issues.
A nuclear deal would not only increase revenues from oil and other exports, but also gradually allow Iran to attract certain investments, in particular to revitalize its oil and natural gas industryworn out during long years of sanctions.