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Iranian oil minister acknowledges broad drop in petroleum exports

  • Article by: RICK GLADSTONE
  • New York Times
  • January 7, 2013 - 9:44 PM

 

Iran's oil minister acknowledged Monday for the first time that petroleum exports and sales had fallen at least 40 percent over the past year, contradicting his previous denials and providing an unusual public admission that the cumulative effect of Western economic sanctions has grown more severe.

The acknowledgment by Oil Minister Rostam Qasemi came as new restrictions from the sanctions are threatening to further choke Iran's ability to sell oil, its most important export.

Under provisions of a U.S. law that take effect in February, importers of Iranian oil that have been exempted from the sanctions cannot send the money used to buy it to Iran without risking penalties in the United States. The result could impound billions of dollars' worth of Iran's expected oil revenue in the banks of those importing countries.

Additional punitive measures were signed into law by President Obama last week that broaden the list of blacklisted Iranian industries to include all energy, shipping and shipbuilding enterprises and seek to restrict barter transactions that Iran has been using to circumvent earlier sanctions.

In another consequence of the sanctions' effects, Qasemi's ministry on Monday stopped the sale of jet fuel to Iran's heavily indebted domestic airlines unless they pay cash. The semiofficial Mehr news agency reported that most commercial airline flights inside the country had been canceled as a result.

Qasemi had consistently asserted that Iran had no problem selling its oil. In an address to the Parliament in September, he said oil exports were rising, despite outside data that showed a sharp drop.

At other times, he has threatened to halt all oil exports in retaliation for the sanctions, apparently in a vain effort to raise oil prices by frightening global oil traders.

Both the Organization of the Petroleum Exporting Countries, of which Iran is a major member, and the International Energy Agency, a group of mostly Western oil-importing countries, have reported that Iran's crude exports fell to roughly 1 million barrels a day by the end of 2012, compared with 2.4 million a year earlier. Other Iranian officials have said it is clear that the country's oil exports have suffered.

The sanctions on Iran have been intensifying for the past few years because of its disputed nuclear program, which Iran says is peaceful but which Western countries and Israel suspect is meant to develop the ability to make nuclear weapons.

© 2014 Star Tribune