Independent projections about the timeframe for such an expansion are varied but are overwhelmingly more modest than Iran’s own projections. More than that, economic analysts tend to recognize that Iran’s financial future is still very much uncertain and that it depends on the country’s ability to secure foreign investment, including investment from traditional enemies in the West.
On Wednesday, Reuters reported that the International Energy Agency had predicted that Iran could increase its output by 500,000 bpd in a year’s time. Iran had previously claimed that it would be able to achieve this outcome within a period of only months, but the IEA prediction is nonetheless highly significant.
Still, that prediction is tentative and it notes that to achieve that level of increase Iran will have to prove to potential foreign investors that the investment conditions are favorable to them and that the situation in Iran will remain stable over the long term. This may be a very difficult task in light of the provocative gestures that Iran has made toward the US and its allies in recent weeks. These include three ballistic missile launches in early March and a speech by Iranian Supreme Leader Ali Khamenei on Wednesday describing as “ignorant” and “traitors” any Iranians who believe the country’s future lies in negotiations, rather than in missiles.
These and other aggressive measures contribute to international banking institutions’ fears that sanctions could be reimposed on the Islamic Republic in the event of the breakdown of the current climate or relations between Iran and the West. And even though Khamenei has personally contributed to the worsening climate, he has also blamed the US for stoking the fears that have thus far held back Iran’s potential recovery.
At the same time, there are signs that US President Barack Obama may be taking it upon himself to direct his administration to dispel concerns about an unstable Iranian investment situation. Last week it was reported that US diplomats had been talking favorably about the nuclear agreement with US-based businesses that might be interested in resuming business with Iran. This has led to anxiety among many of Obama’s critics who believe that he may be working to provide backdoor access to US dollar transactions, thereby undermining sanctions measures that were meant to be left in place following the nuclear deal.
On Wednesday, The Tower published another article conveying some of the criticism of this plan and noting that US State Department spokesperson John Kirby had repeatedly dodged questions on the topic, directing the press to instead ask the Treasury Department about its plans for future sanctions enforcement or opening of the US financial system.
Matt Lee, the Associated Press correspondent who grilled Kirby on the topic on Tuesday, responded to his answers by saying, “I have to say that doesn’t sound like it’s going to ease any of the concerns on the Hill.” And that being the case, it can be taken for granted that many legislators, particularly from the Republican Party, will continue to put pressure on the Obama administration to avoid overstepping the limits of a sanctions relief package that Republican overwhelming disapproved of in the first place.
At the same time, that pressure will also come from independent think tanks and advocacy groups that have long opposed normalized relations with the Islamic Republic, largely out of concern for Western money ending up dedicated to illicit Iranian projects, or in the hands of Iran-backed terrorist groups.
Among these groups is United Against a Nuclear Iran, which was the subject of a Business Wire report on Monday regarding its expressions of concerns about the Obama administration’s apparent steps toward allowing access to the US financial system. In addition to publicly calling upon the administration to continue denying such access, UANI has reportedly been engaged in a campaign to warn companies around the world about the risks of investing in Iran.
Earlier this week, Reuters reported that international businesses had already reported extensive difficulties in convincing Iranian expatriates to return to their country of origin until such time as the Iranian government has initiated serious reforms. This has no doubt increased awareness of the prospective risks, alongside the negative advocacy coming from UANI and other groups. All of this indicates that Iran’s prospective growth may continue to be held back in the current climate, even if the Obama administration moves to undermine Khamenei’s claims that the source of those obstacles is only the “aggression” of the US government.