News ID: 190727
Published: 0703 GMT April 12, 2017

Iran oil industry most successful sector under President Rouhani

Iran oil industry most successful sector under President Rouhani

By Hossein Abbasinassab

One of the most significant achievements of the government of President Hassan Rouhani in the previous Iranian year (ended March 20, 2017) was breathing a new life into Iran's oil industry.

The implementation of the nuclear deal between Tehran and six world powers provided Iran's oil industry a chance to restore the country's clogged economic artery and regain its position in the global oil market.

After the implementation of the nuclear deal, known also as the Joint Comprehensive Plan of Action (JCPOA), actors in the Iranian oil industry soon put high on their agenda the attaining of two primary goals, namely, boosting oil production and attracting Iran's erstwhile oil customers that had stopped buying Iranian oil due to the Western-imposed sanctions on the Islamic Republic.

To the surprise of global oil market analysts, the Iranian oil industry managed to refurbish itself in less than one year after the removal of the international sanctions.

Market analysts and foreign institutions had anticipated that within one year following the implementation of the JCPOA, and given the most optimistic perspective, Iran oil industry is expected to raise production by only 700,000 barrels a day.

However, contrary to their assessments, from the JCPOA implementation day on January 20, 2016 till the same month the following year, Iran's oil production witnessed a rise of more than one million barrels a day rather than the predicted three years to attain the same level of increase.

Now, with production standing at almost four million barrels a day, the Islamic Republic has not only retained its previous status as a major oil producer in the global oil market and once again, but the oil industry has also been transformed into a propelling force for the national economy.

A double-digit growth in the country's oil industry during the previous year (more than 11 percent) also entailed an overall economic growth of more than six percent.

Under the sanctions, many Iranian oil customers in Asia, including Japan, India and South Korea under pressure from the United States start cutting their imports from Iran. It was the same with customers across Europe. Some of the European countries even suspended oil imports from the Islamic Republic as a result of sanctions and pressures from Washington.

Currently, however, Iran is exporting 700,000 barrels of oil daily to Europe and, compared to the previous year, oil imported by major buyers in Asia recorded a 58-percent rise.

Iran's return to the global oil market, reestablishing overseas business ties and providing resources for giving momentum to the country’s economic pace, are among the outcomes of the approach pursued by the government of President Rouhani.

These are direct results of a constructive engagement with the global community.

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