The AP reported that an Iranian lawmaker admitted that the international sanctions movement led by President Barack Obama has caused a devastating 45% drop in Iran’s oil revenue. According to the AP:
Iran’s revenues from vital oil and gas exports have dropped by 45 percent because of sanctions over its suspect nuclear program, a senior lawmaker said Monday, a clear admission that sanctions over Iran’s suspect nuclear program are having a severe impact….
Gholam Reza Kateb, head of the parliament’s budget committee, said oil exports have dropped 40 percent in the last nine months compared to the corresponding period last year. He said banking sanctions also contributed to the 45 percent reduction in revenues.
Iran is under U.N. sanctions and Western oil, banking and trade restrictions over its refusal to halt uranium enrichment, which is a potential pathway for nuclear weapons development. The U.S. and its allies believe Iran might be on a path toward producing nuclear bombs….
Crude oil exports account for nearly 80 percent of Iran’s foreign revenue.
Kateb said details of the steep revenue drop emerged Monday in a report by Oil Minister Rostam Qasemi to the parliament on the status of crude oil and liquid gas sales.
‘On the basis of the report, oil sales are down 40 percent and income has dropped 45 percent in the last nine months,’ Kateb was quoted by the semiofficial ISNA news agency as saying….
The government is already facing a cash crunch from the drop in oil revenues as a result of Western sanctions that Iran calls it an ‘economic war.’...
In another sign of the effectiveness of the sanctions, most flights operated by Iranian airlines to domestic and international destinations have been cancelled because of unpaid debts….
Iranian airlines nearly doubled prices of plane tickets in November because of higher fuel prices and the plunging value of the Iranian rial against foreign currencies.
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** Update January 9, 2013 **
The AP reported that inflation is soaring in Iran because of the sanctions and that its currency is teetering on the brink collapse:
Iran’s central bank disclosed Wednesday that the annual inflation rate hit 27.4 percent at the end of 2012, one of the highest rates ever quoted by Iranian authorities. The soaring rate reflects both the impact of Western sanctions over Iran’s disputed nuclear program and the worsening economic conditions under President Mahmoud Ahmadinejad ... Iran’s currency faces collapse. In October, the Iranian rial lost about 50 percent of its value within a week.
JTA also reported that the Obama Administration and Israel have agreed to establish a joint forum designed to further monitor and analyze the effects of sanctions. According to JTA:
Israeli Finance Minister Yuval Steinitz met with U.S. Treasury Secretary Timothy Geithner and agreed to establish a bilateral forum that would periodically assess the effects of sanctions on Iran….
‘It was agreed at the meeting that a permanent American-Israel forum would be established that will periodically assess the effect of sanctions on the Iranian economy and would review ways to increase the economic pressure,’ a statement from Steinitz’s office said.
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