Company News, Crude Oil, Featured, Government, News, World

Iran’s oil production comeback could be over

by Erika Green

Iran, which easily beat expectations for how fast it boosted crude oil exports after sanctions were lifted, now needs a massive cash injection and the easing of remaining trade barriers, or the recovery could be kaput.

Most industry watchers said when the shackles on Iran’s oil exports were unbuckled in January following a nuclear pact with world powers, it was nearly impossible to return to pre-sanction production and export levels by the end of 2016.

Iran defied the skeptics with a 25% surge in production and now aims to reach an eight-year high of 4 million barrels a day (MMBPD) by Dec. 31, Kallanish Energy understands.

“They have surprised most market participants with the speed they’ve been able to resume production,” Antoine Halff, a senior fellow at the Center on Global Energy Policy at Columbia University in New York, told Bloomberg.

“But to exceed pre-sanctions levels would require investment and technology and that’s a much longer-term proposition,” Halff added.

Iran has said on numerous occasions it’s seeking more than $100 billion of investment from international partners to rehabilitate its oil industry and ultimately reclaim its position as OPEC’s second-biggest producer.

Companies are waiting for Iran to approve the contract model to be used in deals and for clarity on remaining U.S. sanctions before re-entering the country.

Since limits on crude sales were lifted, exports have doubled to about 2 MMBPD, flowing again to previously prohibited markets in Europe, where Royal Dutch Shell and Total resumed purchases.

Production reached the pre-sanctions level of 3.6 MMBPD in April, and maintained that level in May, the International Energy Agency estimates.

Leave a Comment


Suspendisse eget lacus ac lorem vulputate fringilla. Maecenas consectetur est leo, nec scelerisque nulla dignissim quis. Maecenas ut nunc ac mi rhoncus mollis. Mauris sagittis rutrum mi a cursus.


Britannia House
11 Glenthorne Rd
Hammersmith, UK, W6 0LH

Call Us: +44 (0) 208 735 6520

[email protected]

© 2018 Kallanish. All rights reserved.