page_title: Petroleum industry in Iran
section_title: Oil production and reserves
hierarchical_section_title: Petroleum industry in Iran / Oil production and reserves
caption_attribution_description: English: Iranian Total Oil Production and Consumption, 1997-2010.
context_page_description: Iran is an energy superpower and the Petroleum industry in Iran plays an important part in it. In 2004 Iran produced 5.1 percent of the world's total crude oil, which generated revenues of US$25 billion to US$30 billion and was the country's primary source of foreign currency. At 2006 levels of production, oil proceeds represented about 18.7 percent of gross domestic product. However, the importance of the hydrocarbon sector to Iran's economy has been far greater. The oil and gas industry has been the engine of economic growth, directly affecting public development projects, the government's annual budget, and most foreign exchange sources.
  In FY 2009, the sector accounted for 60 percent of total government revenues and 80 percent of the total annual value of both exports and foreign currency earnings. Oil and gas revenues are affected by the value of crude oil on the international market. It has been estimated that at the Organization of the Petroleum Exporting Countries quota level, a one-dollar change in the price of crude oil on the international market would alter Iran's oil revenues by US$1 billion.
context_section_description: Total oil production reached a peak level of 6.6 Mbbl/d (1,050,000 m³/d) in 1976. By 1978, Iran had become the second-largest OPEC producer and exporter of crude oil and the fourth-largest producer in the world. After a lengthy decline in the 1980s, production of crude oil began to increase steadily in 1987. In 2008 Iran produced 3.9-million-barrels (620,000 m³) per day (bpd) and exported 2.4 Mbbl/d (380,000 m³/d). Accounting for 5 percent of world production, it returned to its previous position as OPEC's second-largest producer. According to estimates, in 2005 Iran had the capacity to produce 4.5 Mbbl/d (720,000 m³/d); it was believed that production capacity could increase to 5 Mbbl/d (790,000 m³/d) to 7 Mbbl/d (1,100,000 m³/d), but only with a substantial increase in foreign investment. Iran's long-term sustainable oil production rate is estimated at 3.8 Mbbl/d (600,000 m³/d). According to the Iranian government, Iran has enough reserves to produce oil for the next 100 years while oil reserves of other Middle Eastern countries will be depleted in the next 60 years and most other oil-rich countries will lose their reserves within the next 30 years.
  In 2006 Iran reported crude oil reserves of 132.5 billion barrels (2.107×10¹⁰ m³), accounting for about 15 percent of OPEC's proven reserves and 11.4 percent of world proven reserves. While the estimate of world crude oil reserves remained nearly steady between 2001 and 2006, at 1,154 billion barrels (1.835×10¹¹ m³), the estimate of Iran's oil reserves was revised upward by 32 percent when a new field was discovered near Bushehr. Market value of Iran's total oil reserves at international crude price of $75 per barrel stands at ~US $10 trillion.
  In the early 2000s, leading international oil firms from China, France, India, Italy, the Netherlands, Norway, Russia, Spain, and the United Kingdom had agreements to develop Iran's oil and gas fields. In 2004 China signed a major agreement to buy oil and gas from Iran, as well as to develop Iran's Yadavaran oil field. The value of this contract was estimated at US$150 billion to US$200 billion over 25 years. In 2009, China National Petroleum Corp (CNPC) signed a deal with the National Iranian Oil Company whereby the former took ownership of
  a 70% stake upon promising to pay 90 percent of the development costs for the South Azadegan oil field, with the project needing investment of up to $2.5 billion. Earlier that year, CNPC also won a $2 billion deal to develop the first phase of the North Azadegan oilfield.
  A more modest yet important agreement was signed with India to explore and produce oil and natural gas in southern Iran. In 2006 the rate of production decline was 8 percent for Iran's existing onshore oil fields (furnishing the majority of oil output) and 10 percent for existing offshore fields. Little exploration, upgrading, or establishment of new fields occurred in 2005–6. However, the threat of American retaliation kept the investment way below the desired levels. It only allowed Iran to continue to keep its oil export at or below its OPEC determined quota level. Today, much of the equipment needed for oil industry are being produced by local manufacturers in Iran. Besides, Iran is among the few countries that has reached the technology and "know-how" for drilling in the deep waters.
caption: Iran's Petroleum production and consumption (1977-2010)