Baku, Azerbaijan, Jan. 16
By Umid Niayesh- Trend:
Iran needs significant investments to boost its oil output, meanwhile various conditions make investment in Iran risky, an energy expert believes.
As the International sanctions imposed on Iran over its nuclear program is expected to be removed as the Joint Comprehensive Plan of Action (JCPOA, aka nuclear deal) enters implementation phase on Jan. 16, Tehran would not be able to increase its oil output by more than 200,000 b/d at least in six months, Gal Luft, co-director of the Institute for the Analysis of Global Security told Trend.
"Since the market is well supplied and there is much oil already in storage I don't see Iran's H1 production increase going beyond 200,000 b/d and H2 beyond 500,000 b/d," Luft explained.
"Iran will need significant investments to ramp up production but from an investor's perspective there are so many better investment opportunities today in the market that I ask myself why would anyone in his right mind want to invest in Iran even if the sanctions are lifted, particularly with so much tension in the Persian Gulf."
He further said that the Chinese President Xi Jinping's visit to Iran this month and the agreements signed there will give a better indication about the future of Iran's oil industry.
"I suspect that even the Chinese understand the risks associated with investment in Iran," he said.
