Iran is Losing $133 Million Per Day on Oil Sanctions
Western sanctions against Iran are costing them $133 million per day in lost revenue. The sanctions were put in place to prevent Iran from continuing to pursue their covert nuclear weapons program.
Iranian oil shipments are down 52% since July. Although controversial at first, the sanctions are now seen as a major success as we see record inflation levels in Iran without the price of crude oil destabilizing and spiking.
Oil prices reached a 3 year high in March 2012 when Iran threatened to close Persian Gulf shipping routes, however Saudi Arabia and Kuwait have increased production to make up for the Iranian shortfall, and are actively working on a new pipeline to bypass the Persian Gulf and bottleneck Strait of Hormuz, which Iran has heavily militarized. Currently 20% of worldwide oil deliveries pass through the Strait of Hormuz.
Prices of oil have been falling lately as Saudi Arabia continues to increase production. A higher supply will drive prices down. Saudi Arabia – the largest member of the Organization of Petroleum Exporting Countries (OPEC) – is now producing 10 million barrels per day – the most since 2010.
Current worldwide demand for oil is approximately 90 million barrels per day.
Iran is still able to export 1.1 million barrels per day, mostly to India and Japan.
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