Tough Western sanctions are forcing Iran to take drastic action and shut off wells at its oilfields, reducing production to levels last seen more than two decades ago and costing Tehran billions in lost revenues, Reuters
reported Tuesday, July 10. In the run-up to the European Union ban on July 1, Iran managed to sustain oilfield flows above 3 million barrels per day (bpd) by stashing unwanted barrels in tanks on land and on ships in the Gulf. But oil sales have now slumped to half the rate of last year and storage is running out. As a last resort, Tehran is carrying out “enforced” maintenance at its ageing reservoirs, dropping output below 3 million bpd. This step makes Iran look as if it is caving in to the West and leaves it trailing former rival Iraq in the ranks of the world’s top oil producers.