Iran and Venezuela have been kept out of the regular oil markets for years with US and European sanctions. Iran and Venezuela, each used to export a couple million barrels of oil per day or more if you look further back in time. Venezuela had a longer twenty-year decline because they wrecked their economy and society.
Iran Oil Situation in 2021
The crude oil and condensate that Iran exported in 2020, more than half went to China. According to analysis from ClipperData, much of the oil that was shipped from Iran to China was relabeled as coming from countries such as Malaysia, Singapore, the United Arab Emirates, Iraq, and Oman.
Iran had planned to export 2.3 million barrels of crude per day in 2021 but is getting about one-third of the target (650,000 bpd) based on estimates. The price for one barrel of crude has climbed from $40 in 2020 to $80 this year. Bloomberg and Reuters also reported this year that Iran exports most of its oil through intermediaries to be delivered to China. Intermediaries get most of the profits.
Iran is seeing about 50% inflation and the value of the rial has dropped about 50%.
Iran has won approval to join the Shanghai Cooperation Organization. It took 14 years for that process to reach this stage. It will likely take 2 year to formalize and become official.
Venezuela Oil Situation in 2021
Overall, Venezuela’s production is at about 510,000 barrels per day.
Venezuela does not have the money or experienced oil staff to fix broken oil infrastructure.
Venezuela and Iran Hope to Be Better Flunky’s for China
Venezuela and Iran hope to sell more oil to China but these oil sales would be at steep discounts and middlemen would also take a large cut.
SOURCES – SPGlobal, Bloomberg, Foreign policy, EIA
Written by Brian Wang, Nextbigfuture.com
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
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