Page 4 - DMEA Week 08 2022

DMEA COMMENTARY DMEA

Iran anticipates higher oil

sales, eyes refining expansion

As talks appear set to bring a gradual end to sanctions, Iran has its sights set on
increased oil sales while remaining mindful of the importance of its downstream sector.

MIDDLE EAST IRAN this week said that it anticipates an Development Fund every year, and this year this
increase in oil sales during the next Iranian cal- share will be about 40%.”
endar year as reports suggest that a deal on the The announcement comes as oil prices
WHAT: gradual removal of US-backed sanctions may be this week broke $100 per barrel as the crisis in
Tehran anticipates near. Ukraine deepened, while reports suggest that
selling 1.4mn bpd during While an increase in crude exports are seen as Iranian crude exports exceeded 1mn bpd dur-
the upcoming Iranian vital to improving Iran’s dire economic situation, ing December.
calendar year at $70 per Tehran continues to talk up plans for the expan- Oil tracking consultancy Petro-Logistics
barrel. sion of its downstream sector, which has been a reported that Iranian oil sales climbed to a three-
beacon of light during the sanctions period. year high of more than 1mn bpd in December
WHY: before falling to around 700,000 bpd in Janu-
Iran is working to expand 1401 expectations ary. CEO Daniel Gerber was quoted by Reuters
oil production while Seyed Nezamuddin Mousadi, spokesman for the as saying: “We wouldn’t expect to see 1mn bpd
also adding to refining Islamic Consultative Assembly said on February consistently until there is a change in the political
capacity. 20 that “based on the parliament’s decision, the landscape.”
amount of oil sales for the calendar year of 1401 Meanwhile, Iranian oil production is esti-
WHAT NEXT: – which begins in late March – will be considered mated to have reached 2.5mn bpd during Jan-
The next challenge will be at 1.4mn bpd at $70 per barrel.” uary, an increase of around 500,000 bpd year on
to balance the budgets He added: “Based on the deliberations of the year, but still well below the 3.8mn bpd level of
of the upstream and relevant officials in the Budget Integration Com- January 2018 before the US withdrawal from the
downstream expansions, mittee and considering the country’s capacity, Joint Comprehensive Plan of Action (JCPOA).
as Tehran seeks to bring this resolution has been finalised at the Integra- The country has also set a target of increasing
about major economic tion Committee and the Ministry of Petroleum oil production capacity to 5.7mn bpd by 2030,
recovery. has announced that there is enough capacity which is seen requiring a capital budget of
to reach 1.4mn bpd of exports for next year.” around $145bn, according to UK-based consul-
These figures would equate to $35.8bn in crude tancy IGM Energy.
revenues. While Iran looks to expand exports, it is also
Meanwhile, a statement from the assem- working to ramp up its domestic refining capac-
bly said: “According to the upstream laws, an ity, which has received significant investment in
amount of oil sales is transferred to the National recent years, making the country self-sustaining

P4 www. NEWSBASE .com Week 08 24•February•2022