Their Intention, to Gradually Eliminate Tehran
Based on a Reuters report, Iran’s oil exports have decreased 25% in December. What are the root causes of this decrease in export?
In my opinion, there are two reasons behind the reduction in Iran’s oil exports:
1. Some of the countries which are the main importers of Iran’s oil reduced their imports to some extent so as to evade US sanctions.
2. The more important reason is that the payment system for the purchase of Iran’s oil is faced with problems due to financial sanctions against Iran. Therefore, most of the countries which intend to pay money to Iran through different banks are confronted with numerous problems and there are only two or three banks which are permitted to do these transactions.
Which countries have reduced their oil imports from Iran?
China, Japan, India, South Korea, and Turkey are among the countries which have reduced their oil imports so that they can still enjoy exemption from US sanctions. Washington has, several times, warned these countries that in order to remain on the list of countries exempted from Iran’s oil sanctions, they must reduce their imports.
Sanctions put on Iran’s oil by the US and Western countries and, of course, their regional allies have been expanded during the past two years. What are the secret reasons behind these pressures exerted upon Iran’s oil and energy sector?
One of their objectives is to reduce Iran’s income and the second and more important reason is that they intend for this process to happen gradually. In other words, the western countries, through this process, intend to substitute Iran’s oil with the oil of other countries. If 2 million barrels of Iran’s oil had suddenly been eliminated from the market, it would have, undoubtedly, impacted the prices. This is while the US attempts to exempt some countries or use such policies to gradually force Iran out of the group of oil-exporting countries, and on the other hand, its impact on oil prices will not be revealed. As you are well aware, one million barrels of oil have been reduced from the market and there has been no increase in prices.
The US speaks of sanctions based on which Iran’s oil income will be prevented from leaving the countries to which oil is sold. What are the consequences of such a sanction for Iran?
These sanctions are enforced so that Iran’s oil and gas industry will be under pressure. For example, Iran can buy any goods that it needs with the currency that India or China pays with in return for the purchase of Iranian oil. But the new US sanctions against Iran have created limitations for Iran, with which it can only purchase its needed goods from the same country that has bought its oil. This is while these countries do not have much of the equipment and goods that Iran needs, thus, the implementation of these sanctions will exert more pressure on Iran and limit it in purchasing its goods. Ultimately, this process will impact the oil, gas, and electricity industry of our country.
Many domestic analysts and some outside Iran claim that Tehran has, hitherto, been able to bypass sanctions by resorting to different methods. Do you agree with this analysis?
No. It cannot be said that Iran has been completely successful in bypassing the sanctions, because Iran’s oil production has decreased from 2 million barrels to 1 million.
What role can the private sector play in the sale of oil?
I believe that this process that has begun, where everybody is looking to trade oil, will not succeed. What I suggested six months ago was another approach, that the government’s debts to the private sector in the oil and electricity industry be paid in the form of oil shipments. Big companies which are active in oil and gas will find ways to cash what has been given to them outside of Iran. This process will be limited and, in the end, it will show whether this approach is enforceable or not. If this approach proves to be successful, then the government can develop it. But it will not be possible for every company to sell oil and this will ultimately lead to favoritism and similar matters.
Therefore, in summary, it must be said that the more correct solution would have been that first the companies whose debts were not paid by the government should have received oil shipments and then attempted to sell them and receive the money in foreign currency. Through this process, such companies would have stayed alive, while the present trend is moving them towards bankruptcy. If this process would have proven to be successful, it would have been developed, because the sale of these shipments would have been done in small levels. Thus, if it had been successful, the exports could have been increased through this method and if not, the debts would have been paid and they would discontinue this process.
What is your prediction of Iran’s oil exports? Is it possible that Iran’s oil exports would reach less than one million barrels a day?
Yes, considering the growing pressures and sanctions, it is possible that it reaches less than one million. I believe that there is a conspiracy in this regard to gradually reduce Iran’s oil export and increase the pressures so that, in the end, other countries like Saudi Arabia and Iraq would raise their production. If this process was to be done all at once, it would not have been practical. But today with this trend, the same plan has been implemented in one year.