2024-10-09 12:27:00
Iran has warned Israel against any attacks on its “infrastructure”, amid concerns about possible Israeli attacks on the country’s nuclear or oil sites, in response to its offensive against the Jewish state. An Israeli response could strongly affect the Islamic Republic’s economy; oil remains a financial boon for the country despite international sanctions.
Oil is the engine of the Iranian economyIran is even one of the countries most heavily dependent on its oil industry. The potential is enormous: the country has the third largest oil reserves in the world, and oil exploitation represents over 18% of Iranian GDP and 80% of the country’s export revenues, the first customer for the sale of oil is China.
These exports bypass the American embargo in force since 2018, thanks to the gray market and a significant discount, Iran has even increased its extractions in recent months and, according to the latest data from the International Energy Agency, the country It extracted 3.4 million barrels of crude oil per day in August, which equates to annual revenues estimated at between $15 billion and $20 billion.
Risks of worsening hyperinflation
An Israeli military attack on Iranian infrastructure would therefore have significant economic consequences for the country. production capacities are mainly concentrated in the south-west of IranIsrael has the means for an operation that could hit the Islamic State’s wallet quickly and hard.
The Iranian economy already weakened by years of international sanctions. And in particular from hyperinflation which reaches 30%. The situation could get even worse if Iran’s central bank is tempted to print money, as has happened after American sanctions and the decline in production.
For Thierry Coville, IRIS researcher and specialist in Iran, “ After the sanctions implemented by Donald Trump, Iran’s oil exports were reduced by 10% and Iran lost 20% of its budget revenue. In the event of an Israeli attack on the Kharg oil terminal, where the majority of exports are concentrated, Iran’s central bank could again create money to compensate, which could push inflation to 40%. »
Read alsoThe troubles of the Iranian economy exhausted by twelve years of sanctions
International repercussions
Another effect of a possible Israeli attack is a negative reaction from the financial markets and a depreciation of the currency, the rial, which has already lost more than 50% of its value in recent years.
With half of oil production destined for domestic consumption, part of the country’s economy would also find itself paralyzed.
Domestic trade, already hampered by sanctions, could also be seriously affected.
But the repercussions of an Israeli attack would go beyond Iranian borders and would have effects especially throughout the world. A significant reduction in Iranian crude oil production and a potential shutdown of the industry Strait of Hormuzthrough which approximately 20% of world oil production passes, could push oil prices on the world market up to 100 dollars a barrel according to some specialists.
Read alsoIn the news: Israel and Iran on the verge of direct confrontation
#consequences #Iran #Israeli #response