Why is Iran talking about oil exports after years of sanctions?

In April 2019, the United States, then under the Trump administration, said there would be no more waivers or waivers for Iranian oil sanctions. Then US Secretary of State Mike Pompeo canceled the waivers, reportedly at the time. The goal was to pressure Iran and drive oil exports to near zero. In August 2020, reports said the United States seized Iranian oil on ships bound for Venezuela. Several Iranian ships also arrived in Venezuela in May and June 2020. The UK Royal Marines also briefly stopped an Iranian tanker near Gibralter in August 2019.

Fast forward to November 2021. Iran is talking about oil exports again. This comes as Iran has claimed it suffered the threat of a “pirate” attack at sea and after a Wall Street Journal report earlier this year said Iranian ships had been attacked by Israel on their way to Syria. .

Iran now needs $ 160 billion in investment in its oil and natural gas industries in the coming years to avoid becoming a net importer, the oil minister said, according to a report by Iran International. “Javad Owji told a budget planning meeting on Sunday that due to a lack of investment in the past, the country now faces a tough choice: invest $ 160 in its oil and gas sector or face a decline in investment. production and eventually imports of fossil fuels. “

The oil story has front-page coverage in Tehran. According to a correspondent for the Fars News Agency, the Oil Minister attended the meeting of the Parliament’s Economic Commission and said in a televised interview explaining the details of the meeting: “I introduced the ministry to the members of parliament, while also presenting a report on the sale of oil, oil condensate, exports and domestic sales ”.

The situation is much better than in recent years, he said. “Good work has been done in this field using domestic and foreign energy and capacity.” The Oil Minister stated: “Oil purification, and especially oil purification, good measures have been taken in the government to invest in various projects, and good plans have been identified, which will be key soon.”

Iran has “plans to invest in oil and gas condensate condensate and maintain production, as well as optimize energy consumption and supply of furnace oil and gas oil.” The Minister of Petroleum declared: “With the plans of the Ministry of Petroleum and based on the actions of the thirteenth government, we seek to increase the refinery capacity in the country, which in the next 4 to 5 years will reach 1.4 million tons per day “.

According to another Fars News report, Iran is closely watching as the United States seeks to discuss Iran’s oil exports with China. Iran “has imported an average of 800,000 barrels of oil per day over the past three months, more than double the number in the same period last year,” the report says. Iran may be concerned that China, with which Iran has signed a 25-year agreement regarding multiple partnerships, may come under pressure from the United States. Iran is putting on a brave face, arguing that the United States has failed in the region.

Iranian Foreign Minister Mohammad Javad Zarif and Chinese Foreign Minister Wang Yi rub shoulders during the signing ceremony of a 25-year cooperation agreement in Tehran on March 27 (credit: MAJID ASGARIPOUR / WANA (WEST ASIA NEWS AGENCY) VIA REUTERS)

Why could Iran now be talking about oil and energy exports? One strange thing is the claim that Iran faces “piracy” threats at sea. In recent months, it is Iran that has been harassing ships at sea. In July, an Iranian drone killed two tanker crewmen in the Gulf of Oman. Iran has also threatened the United States and Israel. Tehran views itself as in a shadow regional war with Israel, and shipping is part of that conflict, in Iran’s view. At the same time, Iran desperately needs revenue for its energy sector. You need to repair the old infrastructure. Iran also wants to send energy supplies to Lebanon to back Hezbollah. It also sends fuel to Syria. But Iran cannot do all this generosity without also getting some funding. Hezbollah, Syria and the Iranian-backed militias in Iraq cannot pay Iran a lot of money. So Iran needs China and other places to export.


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