Sanctions Damage Iran’s Oil Industry

David Streeter — August 24, 2011 – 3:54 pm | Iran Comments (0) Add a comment

UPI reported that Iran’s oil industry is feeling the impact of international sanctions as a result of the Iranian regime’s continued pursuit of nuclear weapons. The sanctions against Iran, which were spearheaded by President Barack Obama, have begun to make it clear to the Iranian government that it will continue to be economically isolated and incur more sanctions as long as it continues to pursue nuclear weapons. According to UPI:

Iran’s efforts to slow the steady decline of its oil fields, some of which have been producing for six decades, is being seriously hampered by international sanctions imposed because Tehran refuses to abandon its contentious nuclear program….

The decline of Iran’s aging oil fields, which began producing in the 1940s and 50s, is rapidly becoming a serious problem that could have dramatic long-term implications for the Islamic Republic….

Under the threat of U.N. sanctions imposed in June 2010, reinforced by U.S. and EU measures, European majors such as Royal Dutch Shell, Total of France, Statoil of Norway and Eni of Italy have cut all investment in Iran….

The situation is becoming a problem for domestic companies as well. Khatam al-Anbiya, the engineering and construction arm of the elite Revolutionary Guards Corps, was reported to have withdrawn from South Pars as well….

Industry analysts suspect the withdrawal is related to the sanctions, which allow international assets held by Khatam al-Anbiya to be frozen.

‘Iran’s hydrocarbon production is now locked in a downward trajectory, as high-quality Western technology is off-limits,’ the Financial Times reported.

Prior to sanctions, oil exports accounted for roughly half of Iran’s budget revenue, so the ‘production decline will sting,’ the newspaper said.

Click here to read UPI’s full report.

 

 

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