Iran oil output to reach near-capacity before summer's end
The Islamic Republic has significantly boosted its oil production levels over the past two years despite crushing western sanctions
Iran expects to boost oil production to 3.4 million barrels a day (bpd) by the end of summer, Oil Minister Javad Owji revealed on 22 August during a meeting with members of the Iranian Parliament’s Energy Committee at the National Iranian Oil Company (NIOC).
This would put oil production near the country's capacity limit of 3.8 million bpd. Owji stressed that Tehran has already boosted production by about 50 percent over the past two years despite a “maximum pressure” sanctions campaign from the west.
Iran shipped 2.2 million bpd of crude and condensates during the first 20 days of August, with monthly exports set to reach the highest this year, according to data from TankerTrackers.com.
Iran’s crude exports fell to as little as 100,000 bpd in 2020 from over 2.5 million bpd in 2018.
Owji also revealed that the Oil Ministry completed 31 semi-finished projects worth $12 billion last year and that 67 others valued at $15.1 billion will become operational by early 2024. He added that “executive operations of 15 oil, gas, refining, and petrochemical projects worth $14 billion will also start” next year.
Earlier this year, Owji revealed that oil production reached its highest levels since 2018 when former US president Donald Trump unilaterally exited the Joint Comprehensive Plan of Action (JCPOA) – also known as the Iran nuclear deal – and reimposed crushing sanctions, which have been kept in place by Joe Biden.
The country's boom in oil sales is mainly accredited to its deepening ties with China, as oil trade between the two is set to reach a 10-year high this month.
Beijing has been importing an average of 917,000 bpd of Iranian oil since the start of the year, often classifying it as coming from Malaysia. According to Bloomberg, deliveries to China have sped up recently after authorities eased a probe into imports of bitumen mixture, which Iranian oil is often disguised as after being mixed with Venezuelan crude to bypass unilateral US sanctions.
Iran and China officially signed a 25-year comprehensive cooperation agreement in March 2021.
The recent boost also coincides with diplomatic talks between Iranian and US officials that have so far seen the release of several US prisoners from Iranian prisons and the unfreezing of billions of Iranian funds illegally frozen in South Korea.