June 17, 2022
The Raisi Administration is boasting publicly that it has defeated US sanctions and is now exporting oil at a breathtaking rate above a million barrels a day. But the available numbers do not support the claims.
The Raisi Administration is touting the supposed rise in exports since it took office as proof of its powerful skills of management and ability to find new markets for Iranian oil.
The government has, however, avoided announcing any specific export numbers for many months, although individual officials have told reporters exports were running above 1 million barrels a day.
The regime’s chief claim now about soaring exports has been with one number; Oil Ministry spokesman Ali Forouzandeh said May 29 that revenues from crude exports in the first two months of the Persian year were up 60 percent from the same two months of the previous year.
Forouzandeh called that a “dazzling jump.” And many other officials cited it in the following days as proof that US sanctions had been defeated by Iran. But the average price of an OPEC barrel has risen 64 percent in that time frame, which doesn’t indicate any increase at all in Iran’s oil exports.
The Fars news agency, which is linked to the Pasdaran, carried a news report June 7 that asserted Iran’s daily production since Now Ruz had been 2.55 million barrels per day, with domestic consumption averaging 1.7 million b/d. That would mean just 850,000 b/d of crude exports, well below the government claim of exports exceeding 1 million b/d.
Fars added into crude exports the daily exports of condensate, which it said were running at 200,000 b/d to give a total of crude and condensate exports of 1.05 million b/d since Now Ruz. Condensate is very much like high quality crude, so it is not unreasonable to tally it with crude. However, OPEC has always dealt only with crude oil and it does not include condensate in its reports of production or its quotas for members, so an Iranian figure that includes condensates cannot be compared with the numbers that have historically been used by OPEC and by Iran.
What’s more, during the 2012-2015 period, when the Obama Administration and EU jointly imposed sanctions on Iranian exports, daily crude exports from Iran routinely surpassed 1 million barrels a day and often reached 1.5 million. So, a figure now of either 850,000 b/d or 1.05 million is hardly an impressive number and nothing to boast about.
What’s more, there are reports from international monitors that Iran’s oil exports have fallen in recent weeks because China is shifting to buys of Russian oil, which is being sold at a higher discount than Iranian oil. Kayhan London reported May 30 that Iran had gone so far as to shut down its largest offshore oilfield in the Persian Gulf, Abuzar, because of falling exports.
Kayhan reported that its sources “explained that the shutdown took place because of high Asian demand for low-priced Russian oil, resulting in a sharp drop in the sale of Iranian oil, even at discounted prices.”
Then on June 13, the data firm Kpler said Iran’s exports were 908,000 barrels per day in March, 820,000 in April, but only 400,000 in May.
OPEC and the 10 other states affiliated with it met June 2 and agreed to boost output—not by the 432,000 barrels a day previously planned, but by 50 percent more or 658,000 barrels a day. The goal was to make up for the drop in Russian oil exports. The additional 216,000 b/d, however, won’t make much of a dent in the shortage, which Russia’s Finance Ministry said will soon amount to 1.9 million barrels a day.