The following is the full text of the interview given by Mehmanparast, a former ambassador to Lithuania and former spokesman for the Foreign Affairs Ministry, to “Iran Petroleum”.
The US president has expressed his willingness for talks with Iran while keeping sanctions in place and threatening a squeeze on Iran’s oil sales. Can Iran now pin hope on cooperation with its neighbors that are generally allied with the US?
Had Donald Trump not come to power to pull the US out of the Joint Comprehensive Plan of Action (JCPOA) and had US politicians not come under pressure at the national and international levels for economic benefits from the JCPOA, the conditions would have been different, and we would have seen its full implementation. Trump’s presidency changed everything. Under the present circumstances, we cannot implement this agreement, and we should keep in mind that we can win a deal when we get the upper hand. Under the present circumstances, the Middle East and West Asia are decisive to the Americans and Europeans. Therefore, we can benefit from this situation. Our region is where key energy axes meet. It also gives access to various markets. Therefore, if we can establish stability in the region to prove our standing to regional and transregional powers, we would be able to benefit from the current conditions, including an agreement with the US. We should not necessarily be in agreement with the US on all political issues. We should seek our common interests and push ahead with our talks in the same direction.
Do you mean that we can sit together with the US at the negotiating table based on our common interests?
That’s true. One point that can lead to an Iran-US agreement and subsequently bring about sanctions relief is that both nations share interests in some sectors, which we should focus on. But, in response to your question about Trump’s maximum pressure policy, I should say that Iran would experience much tougher conditions should the US president follow up on his policies more seriously, in which case we would have to consider more serious changes so that Iran’s economy would go ahead without relying on oil. One option would be to cooperate with countries that are exempt from US sanctions or are under Western sanctions in the energy sector, including oil, gas, and petrochemical exports. That can help ease sanctions. However, the fundamental policy that should be considered is that we should look for generating value-added in the oil and gas sector rather than selling crude oil and natural gas. For that purpose, we should make some structural changes in the economic sector and remove weaknesses that bring about a budget deficit. In other words, we need to reconsider measures that make us dependent on revenue from oil, gas, and their derivatives. Like in previous administrations, the current administration should proceed with some fundamental reforms. We need to make big decisions to courageously change the trend that would be costly for the economy.
Do you mean that in parallel with our ties with other countries, we can make arrangements to reduce dependence on oil revenues?
Yes, that’s the way we should adopt. We should squeeze our budgetary shortfall to zero so that we would not face shortages in our everyday spending. Oil revenues should be spent on improving infrastructure. Therefore, oil incomes should be saved in the National Development Fund of Iran (NDFI), and we should not spend them on running costs. I believe that even under the present circumstances, where we are under pressure and sanctions from Western governments, particularly the US, and despite all the unjust behaviors of the US, we should make some changes in the economic structure of the country and organize the budget. Even under the status quo, we can do something for the future of Iran. To that end, we should direct the economic structure from being state-run to the private sector so that oil revenue would be spent on vital issues. That would also serve our children in the future. If this goal is achieved, government costs would decline while privatization would earn us higher revenues. Sooner or later, we should move in this direction. Running spending makes us dependent on our annual budget, and even if US sanctions were not in effect, our revenue and spending do not match, although we may be able to increase oil and gas output. In other words, if we wanted to manage our running costs by enhancing oil revenue, we would not afford the costs. As far as our neighbors are concerned, I should say that we have our own needs. Some needs may be common, and some may be mutual. The common goal is that our regional neighbors have mostly massive energy reserves, and they can benefit from these sources for their development. We should cooperate in order to maintain oil and gas prices so that no neighbor suffers losses. Increased oil and gas revenue is an issue that all governments in the region would be happy with because that can help them invest in their infrastructure. In collaboration with all energy producers, we can benefit from oil and gas income. Regional countries are seeking not to sell crude oil and natural gas but instead to develop their refining and petrochemical industries. We should also try our best to benefit from the partnership of various nations for developing our refining industry and reducing crude oil sales. According to Iran’s oil and gas planning, the country would need $200 billion in investment to preserve its production capacity. That would require foreign investment.
Tariff tensions are stepping up between the EU and the US. Europe’s market remains attractive to oil and gas producers. Can Iran be actively present in Europe’s market?
As there is a global trend towards investment in renewable energies, Iran can also complete its value chain rather than crude sales to export oil and petroleum products. That should be a key principle in Iran’s planning. In the short term, it seems that EU-US tariff tensions would be an opportunity for us to reach our objectives. Generally speaking, we should be able to benefit from all opportunities. The Europeans need oil and gas. The EU used to supply its oil and gas from Russia, but the war [on Ukraine] ended it. We should therefore look at this market. As the Europeans are thinking less about oil and LNG imports from the US, they deem it more profitable to benefit from Iran’s energy market. In the meantime, due to Iran’s location in the North-South Corridor, we can also source commodities to the EU. Therefore, we should engage in dialogue with Europe within a purposeful framework and based on mutual respect. But if the Europeans want to move in line with the US’s incorrect policy of threats and sanctions, we should forsake this market.
How do you see Iran’s energy market and economic conditions now?
Donald Trump often raises foreign policy demands that are irrational. He intends to pursue his goals in this way. He takes big risks and proceeds with sudden and unpredictable changes in his plans and goals. If he goes on to toughen sanctions on Iranian oil exports, we should think of more creative and newer solutions to weaken the impact of US policies. That would make conditions more difficult for us. But for any reason whatsoever, if the Americans conclude that their method is wrong about Iran, they would modify their stance, in which case specialized talks can be held, and we would experience more acceptable conditions. That would push sanctions out of the current status, and we can repair the damage from sanctions. I insist once more that our budget structure and economic trend show that even if sanctions are lifted and oil and gas output increases, we should bring about fundamental changes in the national economy, as ongoing policies would not be useful.
Ameneh Mousavi
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