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Iran's oil output, 2.7 or 4.2 mbpd?

Iran Materials 14 May 2013 13:03 (UTC +04:00)
Iranian oil Minister Rostam Qasemi rejected the rumors that Iran has dropped to the fifth place as OPEC's biggest oil producer
Iran's oil output, 2.7 or 4.2 mbpd?

Dalga Khatinoglu, Trend Persian News Service department chief

Iranian oil Minister Rostam Qasemi rejected the rumors that Iran has dropped to the fifth place as OPEC's biggest oil producer.

He went on to note on May 13 that in terms of oil production "capacity" Iran still stands at the second place after Saudi Arabia.

Qasemi was reacting to the latest report released by the OPEC, but he did not mention to the exact amount of Iran's "real" oil production.

OPEC's latest monthly report, which was released on May 10, shows that Iran's oil production stood at around 2.695 million barrels per day. The report was based on secondary sources (OPEC Research Center).

According to the report, Iran was OPEC's fifth biggest oil producer in April, next to Saudi Arabia, Iraq, Kuwait, and the United Arab Emirates. It is while Iran was OPEC's second biggest producer in April of 2012.

Iranian oil officials haven't announced the country's "real" oil production for months, and just refer to Tehran's oil production "capacity".

Iran's official direct reports to the OPEC are also in contradiction to the report released by the Organization's own estimates.

For example, Iran has announced its oil production in March to be around 3.705 million barrels per day, while the OPEC's report based on secondary sources estimate it to stand at around 2.685 million barrels per day.

Talking to domestic media, Iranian officials even have put the country's oil production capacity above 4 million barrels per day.

On April 17, the IRNA News Agency quoted the oil ministry's spokesman, Alireza Nikzad Rahbar, as saying that Iran's oil production capacity stands at 4.2 million barrels per day.

Statistics of Iran's domestic oil consumption and exports

The Mehr News Agency on April 10 quoted Iranian top oil official Ali Ziari who serves as the managing director of Iranian Oil Pipeline and Telecommunication Company, as saying that Iran's refining and petrochemical capacity currently stands at 1.8 to 1.85 million barrels per day. OPEC's annual report also says the same figure for Iran's refinery capacity.

However, based on the official reports released by Iran Customs Administration, the country's petrochemicals export faced 33 percent decrease in the previous calendar year (which ended March 20) in comparison to its preceding year. So it means that Iran is not using the full capacity of its refineries and petrochemical complexes.

Reuters also reported recently that Iran's international customers were receiving just 810,000 barrels per day of crude in March and quoted oil and shipping officials as saying that Iran's oil exports stood at most at 1.08 million barrels per day in April.

So considering Iran's domestic consumption and export values, the country's real crude oil production, even in positive view, can at most stand at 2.8 million barrels, which is close to OPEC's statistics.

Quoting some Iranian and western sources, Reuters reported in July 2012, that Iran halted production at some of its oil wells and closed them ahead of the EU and US oil sanctions.

An unnamed Iranian source, told Reuters that Tehran's oil exports dropped by one million barrels compared to its preceding year.

Iran's Parliament Research center also confirmed dripping the country's oil production by one million per day during last solar year.

Additional to closing some oil fields, on the other hand, Iran's oil ministry and U.S. Energy Information Administration have estimated that Iran's fields have relatively high natural decline rates (8-13 percent).

Based on mentioned figures and regarding this fact Iran's full oil output capacity was 3.628 mbpd in 2011 before the sanctions targeted Iran's oil export, also lacking any significant progress in upstream projects and increase in oil output, Iran's current oil production capacity is likely under 3 mbpd.

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