A year after the United States withdrew from the Joint Comprehensive Plan Of Action (JCPOA), also known as the Iran Nuclear deal, sanctions have severely impacted Iran’s oil sales, which are expected to decrease to below half a million barrels a day from 2.7 million in June last year. The past two weeks have witnessed drone attacks on oil tankers in Fujairah and the Aramco East-West pipeline, as well as increasing tensions in Iraq, raising fears of military escalation and regional conflict. These developments come after the release of a US intelligence report on the Iranian threat to American interests and personnel.
Many questions now arise on the specter of a wider direct or indirect military confrontation, potentially affecting the region’s security and oil prices. Will the Iranian economy withstand the newly imposed sanctions? Will China see an increase its oil sales to the region? Amid ongoing escalation, what are the prospects for stability and economic recovery in the region?
To answer these questions and more, Diwan spoke to Ali Vaez, Crisis Group's Iran Project Director.
