“Smart decision for Iran to try relying less on oil revenues”

Posted on August 13, 2012

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The decision to move away from the sale of crude as the main source of export earning of Iran is the right choice in the medium and long term, EU economic advisor Mehrdad Emadi said.

Iran has been trying to pay attention to its non-oil sector, and reduce the heavy dependance on oil revenues.

” It is the right choice since Iran will find it only more costly to maintain its oil exports given the impact of sanctions level against its oil sector,” Emadi said.

Reuters reported that Iran’s crude exports dropped to about 1.1 million barrels per day in June and July from more than 2 million bpd at the start of the year.

Iran dropped to third among OPEC’s biggest producers, after holding the No. 2 spot since May 2000.

Currently, Iran is exporting 1.1 million barrels a day of oil, and some analysts forecast the figure to be dropping down more in the near future.

Emadi pointed out that it could still be a winning point for Iran, even if the decision is made late.

“Even without the existing sanctions, diversification of the economy away from the sales and export of crude is the right choice for the Iranian economy, it should be seen as a positive change,” Emadi noted.

The expert further said what is the challenge for Iran right now.

“At the moment Iran needs to achieve this diversification of the economy under stringent sanctions, which have made the transfer of technology to its less technologically advance industries both more costly and slower,” Emadi said.

Iran’s revenues from non-oil sector reached $50 bln from $7 bln in ten years, deputy minister of industries and mines for international affairs Ali Asghar Ramzi said not long ago.

Ramzi noted that major growth in non-oil sector has been reached during the two of country’s 5-year development plans.

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