Iran crisis slows investments in energy reserves.
Byline: Daily Star Staff
Summary: <p>Political upheaval in the aftermath of Iran's disputed presidential election has slowed international oil firms' efforts to find a way through sanctions to invest in the world's second-largest oil and gas reserves.AaJust a few months ago, overtures o·ver·ture
a. An instrumental composition intended especially as an introduction to an extended work, such as an opera or oratorio.
b. to Tehran from the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. under President Barack Obama had the world's most powerful energy companies reassessing the risks of working in Iran.
DUBAI: Political upheaval in the aftermath of Iran's disputed presidential election has slowed international oil firms' efforts to find a way through sanctions to invest in the world's second-largest oil and gas reserves.AaJust a few months ago, overtures to Tehran from the United States under President Barack Obama had the world's most powerful energy companies reassessing the risks of working in Iran and optimistic op·ti·mist
1. One who usually expects a favorable outcome.
2. A believer in philosophical optimism.
op the shadow of sanctions might start to lift.Aa
But outcry following the June election stirred the biggest internal crisis since the 1979 Islamic Revolution, slowing Iranian bureaucracy and spooking dealmakers in big oil firms.Aa
"It's hard to slow down a turtle, but this has," said an executive at an international oil company (IOC IOC
International Olympic Committee
IOC n abbr (= International Olympic Committee) → COI m
IOC n abbr (= ) on condition of anonymity as he was not authorized to speak publicly. "This has put everything into freefall, no decisions are being made."Aa
In the first months of Obama's presidency, energy firms stepped up contacts with Iranian oil officials hoping that with or without President Mahmoud Ahmadinejad This article or section may contain inappropriate or misinterpreted which do not the text.
Please help [ improve this article] by checking for inaccuracies. , US-Iran relations would improve. But tentative rapprochement has ended, and executives are back to playing a tricky holding game.Aa
"I think there is no way forward in Iran," said an executive at another big oil firm with experience working in the Islamic Republic An Islamic republic, in its modern context, has come to mean several different things, some contradictory to others. Theoretically, to many religious leaders, it is a state under a particular theocratic form of government advocated by some Muslim religious leaders in the Middle . "There is nothing happening, nothing at all, and I think there is no risk that anything will happen any time soon after this election."Aa
Sanctions have long stopped US firms investing in Iran's energy sector. European firms were less constrained con·strain
tr.v. con·strained, con·strain·ing, con·strains
1. To compel by physical, moral, or circumstantial force; oblige: felt constrained to object. See Synonyms at force.
2. , but have delayed new deals due to political pressure from Western governments aiming to isolate Iran over its nuclear program.Aa
The West says Tehran is working to develop nuclear bombs, while Iran says that it needs atomic electricity.Aa
The politics left Europe's energy giants trying to convince Iran they want contracts while playing down their interest at home.Aa
"IOCs are keeping a watching brief For the legal context, see .
In British archaeology a Watching Brief is a method of preserving archaeological remains by record in the face of development threat. An archaeologist is employed by the developer to monitor the excavation of foundation and service trenches, so that if things change they would be in a position to start doing business," said Ross Cassidy, analyst at consultancy Wood Mackenzie. "The turmoil will make things a bit more difficult and a bit slower."Aa
Most of Europe's largest energy companies have Iran plans they would like to advance. Anglo-Dutch Royal Dutch Shell Royal Dutch Shell plc is a multinational oil company of British and Dutch origins. It is one of the largest private sector energy corporations in the world, and one of the six "supermajors" (vertically integrated private sector oil exploration, natural gas, and petroleum product , Spanish Repsol, Total of France and Austria's OMV OMV Open Market Value (automobiles)
OMV Orbital Maneuvering Vehicle
OMV Oblates of the Virgin Mary (religious order)
OMV Österr Mineralöl Verwaltung (Austrian Mineral Oil Administration) all have gas export projects on hold.Aa
Norway's StatoilHydro wants a service contract for a gas field project, while Eni of Italy is eyeing more work at the Darkhovin oilfield.Aa
The prospect of changes at the Oil Ministry has exacerbated the impact of political turmoil on the public energy sector.Aa
Ahmadinejad is forming his cabinet, and new faces at the mi-nistry and in other senior energy positions could further delay energy sector development.Aa
"Changes in the oil sector are expected, likely creating more gridlock Gridlock
A government, business or institution's inability to function at a normal level due either to complex or conflicting procedures within the administrative framework or to impending change in the business. both for ongoing negotiations and for getting approvals in the state company, NIOC NIOC National Iranian Oil Company
NIOC Navy Information Operations Command (US Navy)
NIOC Naval Information Operations Command (US Navy)
NIOC Northern Illinois Orienteering Club , for daily activities," said Julia Nanay, analyst at consultancy PFC Energy PFC Energy is an advisor to most of the leading oil, gas and service companies and many foreign governments. PFC advises on emerging issues affecting the energy industry and the global economy. The company was founded in 1984 by J. .Aa
Tehran has not signed a big oil deal with a Western oil firm for years, and has turned to energy-hungry Asian oil and gas companies to help develop the sector. State-run Asian oil firms are less susceptible to Western pressure and are looking to secure energy supplies for future growth, but even their progress has been slow, analysts said.Aa
"Asian firms are balancing their relations with the international community against their oil and gas requirements for energy security," Nanay said.Aa
The oil market, weighed down by high inventories and slowing demand, has barely reacted to turmoil in OPEC's second-largest producer. The impact may have been bigger just over a year ago when commodities raced to record highs and oil prices regularly spiked on Middle East political tension.Aa
Iran's oil exports have not been affected, but internal strife could contribute to slowing domestic demand growth, PFC Energy said in a report last month. It forecast Iran's oil product demand growth would slow to around 30,000 bpd this year, down from 126,000 bpd growth in 2008.
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