Economist: Iran’s oil industry will collapse by 2015
posted at 3:18 pm on December 26, 2006 by Allahpundit
Even hypothetical good news is scarce enough these days to warrant a post. Bibi Netanyahu accused the mullahs last week of wanting to build another “thousand-year reich”; sounds like theirs is primed to last about as long as the first one did.
Iran is suffering a staggering decline in revenue from its oil exports, and if the trend continues income could virtually disappear by 2015, according to an analysis published yesterday in a journal of the National Academy of Sciences…
He said oil production is declining and both gas and oil are being sold domestically at highly subsidized rates. At the same time, Iran is neglecting to reinvest in its oil production.
Iran produces about 3.7 million barrels a day, about 300,000 barrels below the quota set for Iran by the Organization of Petroleum Exporting Countries. The shortfall represents a loss of about $5.5 billion a year, Stern said. In 2004, Iran’s oil profits were 65 percent of the government’s revenue.
If the United States can “hold its breath” for a few years, it may find Iran a much more conciliatory country, he said. And that, Stern said, is good reason to delay any instinct to take on Iran militarily.
Is it really good news? Long term, sure. But mid term, it may make their designs on Iraq that much more urgent. Plus, they’re already taking heat from younger Iranians for jerking around with nukes while the country’s economy is in a shambles; if the bottom drops out and they start to fear a revolution, they might make a move on one of their neighbors to turn the domestic discontent outward. Most intel experts predict they’ll have the bomb within five to ten years, too, so we can look forward to all of this playing out before a rich tapestry of nuclear paranoia. Good times, good times.
Then again, would the Saudis really let that happen? They’ve already threatened (through a mouthpiece) to double their oil production and bring Iran to its knees economically. Imagine it: a new regime in Tehran and a buck twenty-five a gallon at the pump. Sweet.