Despite supplying 90% of its oil exports to China, Iran is weakened now | Current Affairs | Vision IAS

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Despite supplying 90% of its oil exports to China, Iran is weakened now

2 min read

Iran and Energy Geopolitics

Iran's Economic Resources

  • Since 2018, following the U.S. withdrawal from the 2015 Iran nuclear deal, Iran's primary oil export market has been China, accounting for about 90% of its oil exports.
  • The U.S.'s inability to deter China from importing Iranian oil is crucial for Iran's economic foundation.
  • Before this, the sanctions on Tehran, in place since the 1980s, were not stringent on oil exports until 2011-2012 when the EU, influenced by Barack Obama, agreed to stronger sanctions despite initial reluctance due to oil price concerns.

Conflict Over Iran's Oil

While Iran's position as an oil exporter is geopolitically significant, the current conflict isn't fundamentally about scrambling for its oil. Key factors include:

  • Deterioration of Iran's strategic position post-Hezbollah pager attacks and the fall of the Assad regime in Syria.
  • Donald Trump's stance against Iran acquiring nuclear weapons, with a deadline for negotiations that Iran misjudged, leading to increased regional tensions and Israeli attacks.

Oil Prices Implications

  • Oil prices fluctuate based on perceived tensions and the likelihood of U.S. involvement.
  • Iranian threats to close the Strait of Hormuz can raise prices, although historically, the Strait has never been closed.

Impact on China and Russia

  • Both countries face challenges; Russia opts not to assist Iran, and China remains reserved, despite Iran's role as a major energy partner.
  • Potential regime change in Iran is concerning for the China-Russia-Iran axis, as Iran's influence wanes while Turkey rises in the Middle East.

Energy Transition Challenges

The transition to a net-zero energy model by 2050 requires monumental changes, unprecedented in history, involving:

  • Decarbonizing electricity rather than merely electrifying fossil fuel-driven sectors.
  • Geographical dependencies, like Northern Europe's reliance on wind, face economic and technical hurdles, including the high cost of offshore wind and inadequate storage technology.


  • Tags :
  • Iran
  • oil crisis
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