Iran’s Post-sanctions Oil and Gas Management

Abstract

This chapter uses historical and political-economic analysis to unveil the factors hampering Iran’s oil and gas sector development and to identify the key drivers behind Iran’s oil and gas management. It argues that three conflicting tendencies, resulting from more than 11 decades of complicated domestic politico-economic dynamics, have shaped Iran’s post-sanctions hydrocarbon landscape. On the one hand, Iran’s energy sector management follows path-dependence reluctance to grant foreign companies access to its natural resources. On the other hand, its rational need for foreign investments in its oil and gas sector has made attracting international oil companies (IOCs) back to Iran central to its strategy. At the same time, domestic political groups’ competition over power and economic resources also affects Iran’s oil and gas sector management. The influence of these three factors has already left an imprint on the new Iranian Petroleum Contracts (IPCs) and thus, it will continue to shape Iran’s oil and gas management at least for another half of a decade.