Iran announces the discovery of a huge oil field in light of its economic difficulties

UNITED STATES (OBSERVATORY NEWS) — Iranian President Hassan Rouhani said on Sunday the discovery of an oil field in the southwest of the country would increase the proven reserves by one third today, in rare “good news” for the economy exhausted by US sanctions.

In a televised speech, Rowhani said the country was improving economic conditions despite tough US measures against top Iranian leaders and the banking and financial sectors.

According to Rouhani, the field covers 2,400 square kilometers and is located in Khuzestan province (southwest) and contains about 53 billion barrels of crude oil.

The 80-meter-deep field extends some 200 kilometers from Khuzestan province’s border with Iraq to the city of Amidia.

“This is a small gift from the government to the Iranian people,” said Rowhani from the central city of Yazd.

“Today we declare to America that we are a rich country, despite the hostility and unjust sanctions against us, but Iranian workers and engineers of the oil industry were able during this time to discover this huge oil field,” according to the Iranian world television.

The new field will add about 34 percent to the proven reserves of the member state of the Organization of Petroleum Exporting Countries (OPEC), which is estimated by the giant oil group “BP” about 155.6 billion barrels of crude oil.

Iran is a founding member of OPEC and has the fourth largest oil reserves and the second largest gas reserves in the world.

If the new reserves are confirmed, Iran will move to third place in terms of oil production.

– Economic difficulties –

But it remains to be seen how far Iran can benefit from the new field.

Iran has struggled to sell its oil since the United States withdrew from the 2015 nuclear deal and reimposed sanctions on Tehran.

In May, Washington ended temporary exemptions granted to the eight major buyers of Iranian oil, increasing pressure on China, India and Turkey to find other suppliers.

Tehran does not give precise figures, but says some crude oil is still being exported through “unconventional” means.

Other signatories to the nuclear deal with Iran – Britain, China, France, Germany and Russia – are seeking to salvage the deal by avoiding US sanctions, but their efforts have so far not borne fruit.

Iran has seen a sharp economic slowdown this year under US sanctions, and the currency’s decline has driven up inflation and increased import prices.

But Rouhani said the economy is now stable.

“The people have gone through economically difficult days, but at the same time, the people’s reluctance, unity and broad efforts have made us reach a point where … America is disappointed and well aware that our great people have stood firm against American pressure,” he said.

The International Monetary Fund (IMF) predicted Iran’s economy would shrink 9.5 percent this year, its worst performance since 1984 when the Islamic Republic was at war with neighboring Iraq, but said growth was expected to stabilize at zero next year.

Authorities have launched a crackdown on Iranians accused of exploiting the shortage of gold and currencies and volatile prices, where a number of people have been tried and executed.

“I call on the judiciary to explain the multibillion-dollar corruption cases to the people,” Rouhani said in his speech. “Where did the money go?”

He pointed to a “$ 2.7 billion case” in which “the suspect has been arrested and sentenced to death, and is currently in prison – but the money has not been recovered yet.”

Rouhani was referring to business magnate Babak Morteza Zanjani, who is on death row after being convicted in 2016 of embezzling $ 2.7 billion while helping the government circumvent international sanctions.

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