Guest Post: Sanctions Force Iranian Retreat from Global Stage

Tyler Durden's picture

Submitted by Dan Graeber of OilPrice

Sanctions Force Iranian Retreat from Global Stage

Domestic demand for gasoline in Iran was driving growth in the energy sector for the year. OPEC, in its latest report, said retail gasoline consumption in Iran was up more than 20 percent for the first five months of the year, though overall oil demand was relatively flat.  Inflation, meanwhile, was up from stable levels reported last year.  Iran has struggled to find a reliable consumer base given international sanctions pressure and the recent levels suggest the Islamic republic is retreating somewhat from the international energy sector.
The Organization of Petroleum Economies, in its August report, said Iranian crude oil production in part led to a decline in overall output from the Vienna-based cartel. OPEC said crude oil production for its members, not including Iraq, was reported at 28.1 million barrels per day in July, a decline of 270,000 bpd compared with the previous month.  The decline in OPEC oil production in part was led by Iran, which saw its export options curtailed by sanctions imposed by the U.S. and European governments. Tehran announced it still had a viable consumer base in China, however, which received about 12 percent of its oil needs from Iran. The Indian government, meanwhile, said it would circumvent EU sanctions by extending government-backed insurance to tankers carrying Iranian crude because of the "definite need" for oil.
Sanctions, however, have hurt the Iranian economy and its overall crude oil levels. Italian energy company Eni reported that it's been unable to get oil out of Iran for the second straight month, however, because of insurance and banking problems. OPEC reported that the Iranian central bank posted an inflation rate of 22.9 percent this year after ending last year relatively flat. Domestically, oil demand reported a growth rate for May of 7.9 percent, or around 100,000 barrels per day. OPEC suggested any growth from Iran's oil demand was likely the result of gasoline consumption. The Iranian Oil Ministry, however, reported that domestic gasoline consumption was down 6.1 percent during the first two weeks of Ramadan, but has since recovered modestly by 1.8 percent. Gasoline consumption in Iran was up 22 percent during the first five months of the year compared with the same period last year, OPEC said.
Growth in Iranian gasoline demand could be a sign that the country's energy sector is retracting in response to sanctions pressure. Any external inhibitors fro Iran were in contrast to neighbouring Iraq, whose crude oil production is at least partially handicapped by domestic political disputes. On Monday, Iraqi officials said oil output reached 3.2 million bpd, taking the No. 2 spot from Iran among OPEC members.

Iranian threats to close the Strait of Hormuz in early 2012 caused an increase in oil prices. While recent spikes in crude were in response to Persian Gulf tensions, long-term trends were attributed mostly to economic stimulus initiatives in the United States and European Union.

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Dead Canary's picture

"7th Circuit Court of Appeals Rules Brokerages Can Use Segregated Client Funds to Pay Creditors"

HEY TYLERS! WHAT'S THE 411 ON THIS! Why no story.

Colombian Gringo's picture

The Obamessiah has decreed that any money you have, well, you didn't build that, so now on you funds will be corzined away for the sake of the state.

Disagree and we will send Homeland Gestapo to break your teeth. No hope, no change except for the banksters.

otto skorzeny's picture

if you think ANYTHING was/is/will be different with either party in the WH you are F-ing delusional.

FieldingMellish's picture

No way man. Mittens is definitely out for the good of j6p whom with he has so much in common. No way he would make things easy for his buddies the banksters.

Hi Ho Silver's picture

Doesn't matter to banksters who wins, they win regardless.

But that doesn't mean the difference doesn't matter or won't have consequences.

One candidate prescribes "shared success". The other candidate prescribes "equal opportunity, unequal outcomes".

These policies won't affect banksters, but they certainly affect the common man/woman and our economic environment.

They certainly have the last four years.


Colombian Gringo's picture

Be of good cheer, I think Mormon moron is no different, just a ken doll alterative to the mulatto.

Jack Burton's picture

And it will be far different under Romeny. Hope and change is on the way, the smiling vulture capitalist and his gang of lunatic Morman heritics are headed for Washington. Just google Morman Religion and read what this lunatic religion believes, they are one step up from Tom Cruise and the Scientology nut jobs.


Also, why repeat a proven lie and expect it to carry weight on Zero hedge?

"You didn't build that". It is a proven fact that this statement refers to things like sewers, roads and bridges, yet you propose to lie and use it as a reference to a private business enterprise. Why lie? It makes no sense unless one believes they can not make their case based of facts.

Sure, Obama is a loser, Bush was a loser and Romeny is a wall-street whore. Does telling lies affirm anything of value in the debate? I think not.

Colombian Gringo's picture

Obamney, Rombama, whats the difference? They are both freaks sucking the ass of their puppeteers.

BurningFuld's picture

Obamney is smart enough not to start a world war where as Rombama not so much. Could Rombama have picked a worst running mate? It only crystallizes my opinion of what a moron he is.

monad's picture

White meat or dark, its the same dumb turkey.

monad's picture

You are so mean! You are ruining my illusion of choice. I would do something about it but this wasn't covered in school and they didn't teach me how to think either. Tebow did WHAT?! Aw, kittens... what were you saying?

CrashisOptimistic's picture

I'm gonna insert a post here at the top and dare to talk about oil in a thread clearly intended to be about Iranian oil sanctions.

First, the article is chock full of contradictions.  Here's a nice one:

"Growth in Iranian gasoline demand could be a sign that the country's energy sector is retracting in response to sanctions pressure. "

Iran consumes about 2 million bpd domestically.  They had refinery capacity of 1.5 mbpd as of 2009 and as of late 2010 they announced adding sufficient new refinery capacity to fill domestic needs.  

They are pumping about 3 mbpd.  This is down less than 1 mbpd pre sanctions and they are exporting plenty to China and India to fund life.  There are no riots in the street.  There is no starvation.  There is only desperate Obama sycophants trying to declare their lame sanction policy effective.

All that really matters?  Iran's oil extraction rate from the ground was about 6 mbpd in the 1970s.  They are way, way post Peak.  This is forever.

fonzannoon's picture

They produce oil...make tons of money...launder it through apparently every it out and buy preoperty in my dog shits on their lawn...It's all connected.

Element's picture

'Written' by a ghost-writing algo?

chistletoe's picture

It seems to me, the same thing happening to the numbers about Iran,

happening to the numbers about the USA hoi polloi ....


Down in the trenches in america, the people have been figuring out that the banker fees are ridiculous,

no matter whether checking account, credit card, gift card, debit card, whatever,

and add on top of that sales taxes and all the other government requirements,

so people are simply going back to cash transactions and barter,

which saves them a whole lot of overhead and regulation and other headaches

and it also results in a black market economy which goes completely  untallied by the statisticians.


Same thing about Iranian oil.

No one really knows, anymore, how much theyr eally pump,

how much they really refine for their own people,

how much they really export,

because none of thoes transactions can be tallied in US dollars anymore,

and gold leaves no paper trail .....


giggle .....

TheFourthStooge-ing's picture

I'm sorry, but this article lost all credibility for me when its author, Dan Graeber, referred to OPEC as the "Organization of Petroleum Economies".

I mean, for crying out loud, this guy is a senior analyst at and yet he can't even get OPEC right?

Organization of the Petroleum Exporting Countries. It even spells it out at the top of the friggin' OPEC report he references.

If he can't even be bothered to get the easiest details correct, why the fuck should anything else he says be believed? It's a poor reflection on as well. It's a mistake not even a rookie would make. Hell, I'm just another dumb hayseed hick from Ohio, and even I was able to spot that glaring error.

The ironic twist to this is that, according to his bio paragraph, he "also teaches media literacy courses at Grand Valley State University."

CrashisOptimistic's picture

That OPEC flub was beyond bad, wasn't it.  When I tell people Indonesia had to leave OPEC about 10 years ago because they could not export anymore amid falling extraction rate and rising domestic consumption, it's a blank stare inducer.

OTOH, who is and why would anyone think they are significant?

Grand Valley State . . . okay I have never heard of it.  OTOH, Magueri recently spouted a much quoted oil article from Harvard and in just the past two weeks his Brazil and Iraq presumptions have been blown out of the water.

So oh well.  


CharlieSDT's picture

Grand Valley State, that bastion of higher education, is in Grand Rapids Michigan.  Don't go.

lolmao500's picture

So...where are the sanctions against these folks ?

Deutsche Bank AG (DBK) is among four European banks being investigated by U.S. regulators for alleged money-laundering violations, according to an attorney with knowledge of the matter.

Or sanctions against the murdering Obama administration?

malikai's picture

DB is a Primary Dealer.

End of Story.

fonzannoon's picture

For whatever it's worth I know Biderman is a big deal and his video blogs are on here a lot. I watch these pretty often instead. Usually worth the watch.

otto skorzeny's picture

Iranian people are suffering for the greater good of "God's Chosen Hebes". Whoever gets in the WH will do the bidding of AIPAC next spring.

Jack Burton's picture

Indeed! You don't get within a mile of the oval office if you are not approved beforehand by AIPAC. They decide who the American people are allowed to vote on for president.

I dare anyone to dispute that nobody is allowed near the major party nominations without AIPAC's approval beforehand.

Why I might ask does a small nation, that lives off of America taxpayer handouts, have the ability to decide American political candidates and decide most if not all American foreign policy.

I am of Swedish Lutheran background, and as near as I can tell, WE have no say at all in deciding such important questions. So why does another minority people literally hold the reigns of American power?

Yes, of course this question makes me an anti semite, but the question still stands. Why does one group hold all that power, and the group I belong to hold no power at all. Is it our blonde hair they hate, or our radical lutheran religion????

Poor Grogman's picture

Well at least they don't hate you for your freedoms nowadays....

Haole's picture
"If voting made any difference they wouldn't let us do it." - Mark Twain
shovelhead's picture

The only thing AIPAC decides is who they tell the rich Jewish donors who to support.

This is a signifigant pile of coin, so it is YOUR politicians who bend over backwards to compete for that money by supporting pro Jewish policy.

AIPAC does not donate money to politicians, unlike Unions, the NRA or Greenpeace.

They are comprable to a Consumers Report to donors on pro Israel politicians and they do have a lot of influence with those donors. Piss off AIPAC and you will not get any pro Israeli donors money.

AIPAC is not the problem. Money grubbing pols wanting that money is the problem.

At least, if you're going to rant, get some facts first.

Haole's picture

By your comments you don't seem to be aware of just how many duel Israeli/American Zionist "citizens" occupy, and have occupied, numerous positions at the highest levels of "U.S. government".

mvsjcl's picture

Way to Rahm it home!

CompassionateFascist's picture

Why? Because the stupid goyim sheep allowed organized Jewry to obtain near-monopoly control over Big Media and Big Money. By which they own and control most all the politicians. As to Whites in general, Jews regard them with fear, contempt, and hatred: they do not intend to be pogrom'd, or ghetto'd, or holocaust'd ever again. 1900: Whites = 30% of world population. 2000, after a century of Jew-induced massacres, revolutions, and white-on-white wars, Whites down to 9%. By 2100: extinct. That's the ZOGplan. With the world reduced to even lower IQ'd and/or collectivizable blacks, browns, and yellows, the Jew-globalist plutocrats and banksters think they can rule forever. We'll see.  

DoolieDoink's picture

Time for the citizens of the remaining world to start a retaliatory embargo of US banks and products.

Also, what will be fun is that for sure, in future Iran will not be selling oil in dollars !


Bringin It's picture

Bi-lateral trade deals /comodity swaps that do not require dollars have been going on for some time.  Dollar sanctions against Iran only encourage dollar trading alternatives.

bushwarcrime's picture

So wait.....sanctions are working against Iran. But they would not work against Iraq??  First Iran was our mortal enemy(post 1979), and Iraq was our ally against them.  Then Iraq became our mortal enemy, so much so we needed to destroy, invade, destroy them again.  But my sanctions were so much stronger than todays sanction!  Why are we not invading Iran??? I demand to know why we are not invading Iran!!!!

Yours truly,

Shrub the War Criminal

HungrySeagull's picture

You really, really, really dont want to invade Iran.

Mountain passes followed by limited routes can attrit the hell out of you.

francis_sawyer's picture

What kind of fucking bullshit propaganda is this article?

Here's the 'reality' of the Hebrew stranglehold on Washington (& all that comes with it)...



US Reliance on Saudi Oil Heads Back Up


Oh ~ & if you thought you were done paying for the follies of the recent past... Think again... Dig deep now... Somebody's livelihood DEPENDS on your politically correct ignorance...

U.S. Treasury increases auto bailout cost estimate

Ted Baker's picture

Oh boy the beauty of the logic of prejudice

francis_sawyer's picture


Ha!... You stupid MF... You're probably still stuck in the paradigm that ad hominem type comments mean anything anymore (that you're gonna win some sympathy arrows from the PC emos)... I'm guessing that anyone who didn't vote for Obama in '08 was a RACIST too, right?...

Rewind... Here's the TRUTH of my above comment

1. US relies MORE on Saudi oil (CNBC)

2. US Treasury INCREASES auto bailout figure [REUTERS] (so go dig in your pocket some more)


Got anything to ADD to that?

CrashisOptimistic's picture

I thought for a moment yours would be the first post about oil in an oil thread, but not really.  You lost the train of thought.

francis_sawyer's picture

 "I thought for a moment yours would be the first post about oil in an oil thread, but not really"


What part of:

"US Reliance on Saudi Oil Heads Back Up"

did you not understand?

Poor Grogman's picture

I just can't get very concerned about oil depletion.

It is a problem that each of us is already facing up to and adapting to every time we fill up with gas.

The mal-Investment caused by financial lunacy is more worrying, as it directs precious resources toward propping up the unsustainable status quo, rather than letting real market forces shape a more practical and innovative use of resources, including the remaining oil.

Anyone for an overseas holiday or new plasma TV( funded with your credit card of course)?

Insanity bitchezz..

poor fella's picture

They're both important so circular reasoning on your part IMHO.

Market forces are levered across the board and seem only to react to crisis lately (like politics) - oil depletion will continue unabated until something blows up and it doesn't matter how much mal-investment there is or how much money one has. All that matters is what can be distributed around the country. If 'practical' uses of oil doesn't magically arise from said market forces - nobody will give a flying shit about financial lunacy.

That clock is reading 12:59:45  - and we can't even talk about this during election season!?

Now; gay marriage and abiotic oil, those are things that don't concern me one iota...

Poor Grogman's picture

People can be happy and fulfilled at many levels of per capita oil consumption, other than what we have now.

Pumping consumer credit into the system is the equivalent of pouring growth hormones into the bacteria colony. Of course they are going to consume and multiply faster than is sustainable.

How can we hope to adapt to our environment or find better ways to do things when we have no real market signals to tell us what things are actually worth?

FieldingMellish's picture

Since the NAR is exempt from money laundering, maybe the Iranians could swap oil for US real estate. Then again, that would be worse than selling it for worthless paper like the Saudis do which, btw, has a 5%+ inflation rate and no sanctions, go figure.

fonzannoon's picture

In my neighborhood the worst houses constantly get sold and then knocked down and some arabian looking palace goes up 2 months later. So yes I think you are on to something.

FieldingMellish's picture

Jokes on them, given the direction house prices are going. Maybe Goldman Sachs advised them to buy?

fonzannoon's picture

This is from Ann Barnhardt's site. Her response to giving an interview with RT today...

"RT stands for "RUSSIA TODAY" and is fully funded by the Vladimir Putin regime. It is Putin's propaganda arm to the English-speaking world.

And so, after a nano-second's thought, the answer is NOPETY, NOPETY NO.

See, Vladimir Putin is the enemy. He is a very, very evil man and is the enemy of freedom. Those Russians are very, very clever and have essentially checkmated the western world, and the United States. They infiltrated the government, the academia, the media and the Church in the 20th century and put in place and set rolling the Marxist policies that are now in full bloom and have destroyed us. At the same time, Putin's propaganda news outlet, RT, is the only news outlet that is reporting on what a massive, unfixable clusterbungle the Western economies are. I'll grant RT that - their reportage on financial and economic matters IS INDEED ACCURATE, but their motives are not to help save the system or even to warn people of the looming disaster. The motive of the RT ownership is to bring about the collapse of the West that Russian Communists designed and executed over the last 70+ years, and thus set the stage for a Russian-backed and Russian-controlled currency and global economy.

So, no, I won't be appearing on RT, no matter what. Even if the show anchors aren't explicitly Communists and are merely people who think that the ends justify the means, the fact that RT is a Putin property and operational arm means that there is no possible way that I could ever, ever appear on that network.

Christians do not treat, parley, negotiate, compromise or converse with the enemy - even through intermediaries. The ends do not justify the means. If it is indeed the will of God Almighty that I have an audience of tens of millions of people, then I trust that He, in His omnipotence, can make that happen without my having to crawl into bed with VLADIMIR FLIPPING PUTIN. "

francis_sawyer's picture

Well as far as 'crawling into bed' is concerned... they have Lauren Lyster... francis_sawyer is in HER BED until further notice...