According to recent financial reports by the U.S. Energy Information Administration (EIA), Iranian oil exports have fallen to a 26-year low, due to robust U.S. and EU sanctions.
“Sanctions affecting investment in Iran’s oil sector have also been tightened, resulting in cancellation of new projects by several foreign companies; they also negatively affected existing projects,” the EIA concluded in its report last week. “Following the implementation of sanctions in late-2011 and mid-2012, Iranian oil production dropped dramatically.”
According to the EIA report, Iran’s exports of crude oil declined to approximately 1.5 million barrels per day (bbl/d) in 2012, compared with 2.5 million bbl/d in 2011.
Exports could fall further through 2013 with the latest set of EU sanctions barring EU insurance companies from providing coverage to any refiner and refinery operators that process crude oil of Iranian origin.
Oil exports make up 80 percent of Iran’s total export earnings and 50 to 60 percent of its government revenue, according to the Economist Intelligence Unit.
The Obama administration has supported strong economic sanctions against Iran as a means to deter the Ahmadinejad government from enriching uranium for nuclear weapons. Without International Atomic Energy Agency (IAEA) monitors to report on any alleged uranium enrichment, it remains unclear how this policy has affected Iranian decision-making.
What is known is the negative impact broad U.S. sanctions have had on Iran’s 80 million citizens.
“People are having a really hard time to just buy things. Everything is super expensive. All Iranians know is that these sanctions are because of what is going on in the U.S — they want to know about the nuclear program,” said Miranda Kadkhodayan, an Iranian-American, to Mint Press News. “It is something that is not in control of the people. People are going through hardships.”
There has also been a scarcity of essential medication. In 2012, the Iranian Hemophilia Society informed the World Federation of Hemophilia that the lives of tens of thousands of children are being endangered by the lack of proper drugs, as a consequence of international sanctions.
Roughly 8,000 hemophiliacs are finding it harder to get blood clotting agents for treatment.
Formal negotiations have failed to produce a compromise, but have continued bringing the U.S., Russia, China, the U.K., France and Germany — known as the “P5+1” — into negotiations with Iran. The most recent round, which took place earlier this month in Almaty, Kazakhstan, yielded no significant breakthroughs.