By Mohammad Sadat Khansari
According to a state-run website known as Entekhab (Sunday 1 June 2018), the regime’s vice president, Eshaq Jahangiri, states: “Iran’s crude oil will be offered on the domestic bourse, and for the private sector who can export it in tonnages, as required. As of now, we are selling around 60 thousand barrels a day”.
The regime’s decision of assigning oil to private sectors stems from the ongoing turbulence of economy; Given Trump’s plans of halting Iran’s oil exports by 4th November 2018 and considering the heavy reliance of Iran’s regime on oil too, the economy is expected to go even more downhill here onwards.
As reported by Reuters News, for the first time since 2012, South Korea has suspended its oil imports from Iran; Japan has also based its upcoming imports on the condition that it gets exempted from US sanctions; India has reduced its purchases from Iran too. The Reliance Industries Limited, which owns the biggest refinery of India, has also decided to stop importing from Iran, due to upcoming US sanctions on Tehran.
All these examples prove just how seriously the attempts of US have been taken by many countries, in terms of cutting oil imports from Iran.
As addressed by Jahangiri (1 June 2015), Rouhani’s administration is now facing very serious issues with regards to its economy and society: “The current situation is like a room filled with gas; with the slightest spark, which in this case can be any additional form of turbulence, the entire room can be set on fire”.
Considering the reliance of Rouhani’s government on oil, one can see why it would make every effort to circumvent the upcoming sanctions and continue to plunder from its exports. The question that remains, is what would be the practical consequences of them doing so?
Over the past several years, the Regime was seen using a similar approach; where Babak Zanjani (famous outcaste and imprisoned mogul) and his gang, one of whom was a British citizen named Mehdi Shams, found a way around the sanctions and continued selling oil for the regime, using unknown shipping companies, such as one from Malta. In a court hearing, where Zanjani admitted to his possession of a 22 billion-Euro worth of cash (ISNA, 10 November 2015), he described with a self-righteous attitude: “Just like a pirate, I spent days on the sea, in order to sell our oil”; his 22 billion Euro is equivalent to 25 billion and 872 million dollars, which is more than a 5 years-worth of Iran’s subsidy; which is a truly astronomical figure indeed. Mehdi Shams was also accused of the malversation of 1 billion and 200 million Euro around the same time (Afkarnews, 24 June 2017).
Given the lack of private sectors in Iran, or as Rouhani puts, the presence of seemingly private ‘half-public’ sectors, the term ‘private’ usually applies to Revolutionary Guards; who have full control over many small and big companies across the country. Which means that when Rouhani declares his decision of assigning oil to “private” sectors, what he really means is giving it away to the Guards; and eventually, taking a share of the profits for himself as well as other “Aghazadehs” (a term used to refer to ‘children of super rich political and religious elite’).
A spokesman of the Regime, named Mohammad Bagher Nobakht, comments: “To tell you in a nutshell, we have lost some of our assets, which we once used as an alternative approach to overcome certain hurdles”.
To conclude, the Regime’s plans of circumventing the upcoming sanctions is only predicted to create more people like Zanjani, which has already turned out to be the case; as revealed by a parliamentarian, there are dozens of “Zanjani”s out there already, who are rent-seeking from a new opportunity worth 110 thousand billion Toman.
When oil is in the picture, hundreds of billions of dollars are to be profited from it, which is not going to be of benefit to anyone but the Revolutionary Guards and ‘Aghazadehs’ themselves. No country has ever been successfully run by kleptocracy, so the regime’s continuing efforts of plunder are only going to fill the pockets of its own pawns and workers, not the actual people of Iran.
Mohammad Sadat Khansari is a researcher analyst and consultant, specializing in Human Rights, political and social affairs. He has expertise in Iran, and the Middles East affairs.