Iran to cut oil production and prioritize defense
Tehran: Iran plans to cut oil production and prioritize defense spending in its 2022-2023 draft budget due to US-Israeli sanctions and threats related to its nuclear program.
Iranian news agencies reported that the project, presented on Sunday, projects GDP growth of 8%. President Ebrahim Raisi has submitted the draft to parliament for a vote scheduled by the end of 2021.
In Iran, the New Year begins on March 21. Iran plans to produce 1.2 million barrels per day at a projected price of $ 60 per barrel. This is down from 2.3 million bpd at a price of $ 40 a barrel, leaving revenue of $ 26.3 billion compared to $ 33.5 billion in the last budget. Industry experts believe the estimate is too high given that Iran currently sells around 600,000 barrels per day.
Oil sales represent a quarter of budget revenue, with an additional 25 percent coming from a steep tax increase. The 2022-2023 budget allocates around 5 billion dollars to strengthen “defense capabilities and strategic research”, the Tasnim news agency reported, against 4 billion dollars the previous year.
Washington, which has imposed severe sanctions on Tehran, warned in October of “other options” if diplomacy over Iran’s nuclear program fails, while Israel reserved the right to appeal. to force. A 2015 nuclear deal between Iran and world powers has disintegrated since US President Donald Trump stepped down three years later.
The deal guaranteed sanctions relief for Iran in exchange for strict restrictions on its nuclear program. Trump also reintroduced sanctions, including on its oil exports, prompting Tehran to start ignoring the agreement’s limits on its nuclear activities in 2019.
Trump’s successor Joe Biden has said he wants the United States to return to the deal, but international negotiations in Vienna to reactivate the deal have so far failed to make any progress. significantly.