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Report: Iran oil profits could dry up by 2015
cnn.com — "Iran is suffering a staggering decline in revenue from its oil exports, and if the trend continues income could disappear by 2015, a National Academy of Sciences analysis found. Iran earns about $50 billion a year in oil exports."
parislemon- 307 diggs
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- snowbooch, on 10/12/2007, -8/+11thats ok, the iran nuclear blackmail profits will pick up the slack
- treelovinhippie, on 10/12/2007, -6/+5Bush: "Well screw invading them!"
- kutaone, on 10/12/2007, -5/+13I'm sure China will make sure there is always a large market for Iranian Oil and I'm also sure they won't mind picking up the bill for the Iranian infrastructure to maintain oil production levels as long as they are the recipients of cheap oil.
Kinda funny how the world offered to completely redo the entire Iran oil infrastructure for free in exchange for giving up their nuclear ambitions...we all see which route they picked... - niczar, on 10/12/2007, -8/+18What kind of ***** is that? Prices of oil are going up, they have are among the top 5 in proven reserves, how could that be? I suspect ***** here.
- JeffH, on 10/12/2007, -8/+16Hint: Oil isn't limitless.
- masscrazy, on 10/12/2007, -16/+4Its CNN!!!!! Duh it an AMERICAN news corporation i.e. NOT to be trusted on matters regarding err ANYTHING especially when the middle east is in question.
- Buelldozer, on 10/12/2007, -1/+14Prices are going up but their PRODUCTION is dropping due to mis-management of their fields and poorly managed refineries and pipelines.
- rblinne, on 10/12/2007, -1/+4What's interesting about the CNN report is that the recommendations of "economic warfare" through fuel efficiency in the PNAS paper are nowhere to be found. Even so Iran is in such dire straits and all we need to do is nothing and watch them collapse. If we can hold tough and remain deaf to their "threats" we may be able to keep nuclear weapons away from Iran long enough that they fail to have enough resources to build such weapons.
As for the peak oil thesis it was specifically repudiated in the report. This is purely a result of mismanagement by the Iranian government.
From the last line of the PNAS abstract:
Energy subsidies, hostility to foreign investment, and inefficiencies of its state-planned economy underlie Iran's problem, which has no relation to "peak oil."
Here's some of the details in the body of the report that support the conclusions above:
House of Cards
Our survey suggests that Iran’s petroleum sector is unlikely to attract investment sufficient to maintain oil exports. Maintaining exports would require foreign investment to increase when it appears to be declining. Other factors contributing to export decline are also intensifying. Demand growth for subsidized petroleum compounds from an ever-larger base. Growth rates for gasoline (11–12%), gas (9%), and electric power (7– 8%) are especially problematic. Oil recover y rates have declined, and, with no remedy in sight for the gas reinjection shortage, this decline may accelerate. Depletion rates have increased, and, if investment does not increase, depletion will accelerate. If the regime actually proceeds with LNG exports, oil export decline will accelerate for lack of reinjection gas. In summar y, the regime has been incapable of maximizing profit, minimizing cost, or constraining explosive demand for subsidized petroleum products. These failures have very
substantial economic consequences. At $60 per barrel, 2006 income foregone from quota shortfall and refinery leakage will approach $11 x 10^9. - rblinne, on 10/12/2007, -1/+3The rest of my quote from the PNAS paper got chopped by Digg:
Despite mismanagement, the Islamic Republic’s real oil revenues
are nearly their highest ever as rising price compensates for stagnant
energy production and declining oil exports. Despite high price,
however, population growth has resulted in a 44% decline of real
oil revenue per capita since the 1980 price peak. Moreover, virtually
all revenue growth has been applied to pet projects, loss-making
industries, etc. If price were to decline, political power sustained by
the quadrupling of government spending since 1999 (derived from
ref. 18) may not be sustainable. Yet we found no evidence that Iran
plans fiscal retrenchment or any scheme to sustain oil investment.
Rather, the government promises ‘‘to put oil revenues on every
table’’ (37), as if monopoly rents were not already the entrée.
Backing this promise is a welfare state built on the Soviet model
widely understood as a formula for long-run economic suicide. This
includes the 5-year plans, misallocation of resources, loss-making
state enterprises, subsidized consumption, corruption, and oil ex-
port dependence that doomed the Soviet experiment. Therefore,
the regime’s ability to contend with the export decline we project
seems limited. - sanitychek, on 10/12/2007, -4/+3They are being sensible.
The old Iranian fields are well past peak. Delay their exploitation of new fields and what they have will be worth much more. Remember, you can only pump it once - either to prop up the US or to prop up domestic production. Sounds like they have taken the sensible path with a growing workforce and have elected to produce that oil later rather than sooner.
It will hurt the US, which is no bad thing from an Iranian POV. Couple Mexico depletion with Venezuela and the US is in an unstable position. Say hello to $4+ a gallon guys.
- luv2lrn, on 10/12/2007, -1/+8Great! So there may actually be a legitimate reason for Iran to pursue nuclear technology. Better step up the pre-emptive strike planning before there are any more stories like this!
- ddxChrist, on 10/12/2007, -4/+7I find it unsettling that this is a reason for "not bombing them" (according to the article). Why should a military strike even be considered? We're not doing so well in the region, and the idea that we should, or even could, attack Iran is absurd.
- redbonefish, on 10/12/2007, -8/+2YAY that means the USA can the ***** out of the middle east!
- codyman, on 10/12/2007, -0/+5First off, doesn't the US not trade with Iran anyways?
Second off, I guess we can just use Canada:
http://www.wired.com/wired/archive/12.07/oil.html- jsg7, on 10/12/2007, -2/+1Doesn't matter. It still raises the price of oil in general.
- sanitychek, on 10/12/2007, -0/+1Oh FFS.
No plans have Canada producing more than about 3mpbd within a decade. The US consumes more than 20mbpd currently.
Tar sands won't save you. Stop reading daft comments from idiot journalists, start researching the reality. They are currently limited by access to gas and access to water - and don't have an immediate way past that barrier.
Its not how much there is in the ground, its how fast you can get it out and what limits you have on doing so. Canada has big limits, and nobody has a workable way of dealing with oil shales either.
- TeamJesus, on 10/12/2007, -7/+2 Comment Removed
- dustedknuckle, on 10/12/2007, -2/+2That article sounds like it was written by a nine year old kid with ADD. Pretty poor writing skills for someone writing for the AP.
- Toast1185, on 10/12/2007, -2/+4They can always sell enriched uranium as a perfectly legitimate energy source... yikes
- Threlly, on 10/12/2007, -5/+5Strange isn't it.
Iran states it will stop selling oil in Dollars, but begin selling in Euros and the MAJOR alarm bells begin to ring in the U.S. administration.
If any of the other oil producers follow suit, the U.S. Dollar will sink to unknown depths, ending the phenomenon of U.S. 'Hegemony'.
This is 'brown-trousers' time for Bush and the Neo-Cons, funny how they have suddenly become hard-line, using the nuclear issue to get nasty with Iran.
There are other states in the world threatening nuclear development, but the U.S. is oddly silent on that score, could the deciding factor be that the other nuclear rebels have NO oil ???
If the Oil producers start to sell in Euros, it will end U.S. dominance in the World, as the value of the U.S. Dollar is intrinsically linked to the sale of oil, in fact it underpins the U.S. economy.
I think the U.S. will invade Iran sooner, rather than later and use the nuclear issue as a cover.- broomett, on 10/12/2007, -6/+4Wow. I can only IMAGINE the fun sites in your Bookmarks. Lots and lots of sites with a big PLEASE DONATE VIA PAYPAL link on them.
- Threlly, on 10/12/2007, -5/+1err, dunno, does Demonoid and ebay count ???
dufus - fyten, on 10/12/2007, -0/+3I have heard conflicting reports on whether or not switching oil prices to the euro will affect the value of the dollar. The key for the dollar is the amount of foreign purchases of US government debt, not the price of oil in dollars. Now, if the mid east countries decide to not purchase US government debt, regardless of how oil is priced, yes, the dollar is screwed.
- daxsymbiont, on 10/12/2007, -0/+5"it will stop selling oil in Dollars, but begin selling in Euros"
no, they announced they'd sell in euros 'in addition' to dollars. the dollar is a monopoly in the oil market.
- kingygk, on 10/12/2007, -1/+2Let them spend all of thier cash on nuke research and then they will get broke faster.
- yuko511, on 10/12/2007, -0/+3Actually with nuclear energy technology now they have an alternative. I saw an Israeli government representative on tv saying how their nuclear program couldn't possibly be for peaceful reasons because they are floating on oil. I guess that theory is out the window now, although I'm sure they will come up with something else to justify bombing Iran.
- DTJunkie07, on 10/12/2007, -1/+1im scared :(
- daxsymbiont, on 10/12/2007, -0/+2smells like *****.
- garlicknots, on 10/12/2007, -1/+3Hmm. Interesting.
Another way to read this bit of propaganda is that Iran is one of the few oil rich countries that is not pushing production to deplete its reserves. It sounds like "diversification", instead that evidence is being used to substantiate the opinion that Iran is in dire straits.
As an aside, Roger Stern is listed on JHU's site as a PHD candidate : http://engineering.jhu.edu/~dogee/students/
True, that is not sufficient to question the man's impeccable research, but part of accreditation is the PHD, no?
AP writer mispelt "delay"..."belay", kudos.- Dutchmang, on 10/12/2007, -0/+1"Belay" means stop in this context. Look it up before you start slagging.
- daxsymbiont, on 10/12/2007, -0/+2iran announced before a couple of weeks it accepts euros in addition to dollars for dealing oil. google that in connection to middle east wars and you'll find quite a lot of respectable sources talking about the connection of currencies with politics.
- mos6507, on 10/12/2007, -1/+3--
Actually with nuclear energy technology now they have an alternative. I saw an Israeli government representative on tv saying how their nuclear program couldn't possibly be for peaceful reasons because they are floating on oil. I guess that theory is out the window now, although I'm sure they will come up with something else to justify bombing Iran.
--
I think Israel has plenty of reasons for bombing Iran as it is. - yuko511, on 10/12/2007, -0/+0And they are........ or are we suppose to just know them intuitively?
- dukeeeey, on 10/12/2007, -1/+1Unless new data shows other wise
peak oil was December 2005. That's all folks, we consumed it all too greedily. US oil production peaked in the 70's. It didn't matter how much money they dumped into it, production kept falling. The same is happening all over the world, but people are just too stupid to pay attention.
Living in an era of ever declining oil production will prove to be interesting. (Uncharted economic/political/social territory).
I fully expect USA to go on another axe wielding murdering rampage through a few more OPEC countries to secure oil for themselves (probably Iran next). Their current military bases surround a HUGE amount of the worlds proven oil reserves and strategic points like pipelines etc. Get a map out and see for yourself, it's pretty amusing really.
For any Americans out there dumb enough to think the war on terror wasn't about oil, look at these declassified documents.
http://i126.photobucket.com/albums/p95/dukeeeey/iraqoilfields.png
http://i126.photobucket.com/albums/p95/dukeeeey/oilmap.png
Next you will realise, that WOW 911 was pretty conveniently timed really ? Because without it there wouldn't have been any war of terror. - Burritovision, on 10/12/2007, -0/+1this decline is likely due to Iran not doing business with the US or other fiscal reasons rather than production capacity. Note that nations trading oil in dollars all would be producing less 'profit' while their production could remain normal.
This kind of study seems to be more financial/industrial propaganda. Iran has oil. Even if they shut down production for one month, the world's markets would have less oil than needed to continue.
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