The Impact Of Sanctions On Iran’s Oil And Natural Gas Exportation: Swot Analysis

 

Volume 2, Issue 4, Number 4, Pages 63-75, Published Online October 20, 2014

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Author(s):

Davood Behboudi, Hossein Panahi and  Taghi Zamzam

ABSTRACT:

Iran holds the world’s fourth-largest proven oil reserves and the world’s second-largest natural gas reserves. International sanctions are redefining the Iranian energy sector, and the lack of foreign investment and technology is affecting the sector profoundly. In 2012, Iran saw unprecedented drops in its oil exports as sanctions by the United States (U.S.) and European Union (EU) were tightened, targeting Iranian oil export revenues. Oil and gas revenues play a vital role in Iranian government’s performance. That is why we decided to have a glance on efficacies of recent sanctions on Iran’s oil and gas exportation. The purpose of this paper is to outline how the Western sanctions have affected Iran’s oil and gas sector. Our studies show that, international embargoes have negatively affected this sector. Of course, Iran is not reactive and strikes back. Furthermore, in this study, through Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis, we concluded that some of the top priorities for Iran to thwart the impact of sanctions are: develop its Natural Gas fields, reduce unrefined oil sales and enhance its exportation of petroleum products, correct internal mismanagements, and also reduce its annual budget reliance on crude oil revenues by non-oil export development and using tax monies.

KEYWORDS:

Sanction, Iran, U.S., EU, oil and gas sector, Hormuz Strait, SWOT.

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