With the world already oversupplied, and with oil prices well below most countries’ break-even price, Iran has added to the misery by promising to add another million barrels per day to the glut.
In an exclusive interview with CNN, Deputy Oil Minister Amir Hossein Zamaninia explained that:
“We do not intend to sanction ourselves again after coming out of the sanctions. We want to increase our production to the level we used to produce prior to the sanctions, and at that time, then we can get together and discuss and strategize for the future.”
Paradoxically, as a result of sanctions Iran is much less dependent upon oil revenues than other oil producing states. Although Zamaninia put this politely, calling it a “silver lining”, the message will not be lost on a US fracking industry that is already staring into oblivion. At present, Iran can break even as the rest of the world goes bankrupt. Indeed, Zamaninia believes that over the coming months Iranian oil will attract $40-45 billion investment even as investors are fleeing the rest of the world oil industry.