Iran oil production declines amid US naval blockade — Bloomberg
The question now is which country will withstand economic pressure longer (photo: Getty Images)
Iran has decided to begin reducing oil production due to a US naval blockade in the Strait of Hormuz, which has restricted the country's trade. However, Tehran has reportedly prepared for such a scenario, Bloomberg reports.
The outlet notes that Iran has years of experience preparing for such scenarios.
As a result, Tehran is preemptively cutting oil production to avoid exceeding storage capacity limits, rather than waiting for storage tanks to fully fill.
In addition, engineers have learned to shut down oil wells without causing major damage and to quickly restart them after years of sanctions and production disruptions have created cycles of instability in the country's oil industry.
"We have enough expertise and experience. We're not worried," said Hamid Hosseini, a spokesman for the Iranian Oil, Gas and Petrochemical Products Exporters' Association.
Bloomberg notes that these methods, refined during multiple wars and sanction regimes, were further developed during Donald Trump's first term, when the United States withdrew from the 2018 Iran nuclear deal and imposed sanctions that forced Iran to sharply cut production.
However, in the long term, these restrictions proved far from fatal, and the country's oil output recovered in subsequent years.
At the same time, Iranian officials acknowledge that their ongoing efforts to maintain oil production can only be effective for a limited period. For them, the question is whether they can hold out longer than the United States amid the economic consequences.
Iran constrained in oil revenues
About five days ago, US President Donald Trump said Iran had roughly three days left before its oil infrastructure would "explode," including due to overflowing storage facilities.
Media also reported that, according to the Pentagon, Iran has already lost nearly $5 billion in revenue during the blockade of the Gulf of Oman initiated by the United States, income it could have generated from oil sales.
