Potential Impact on Iran’s Oil and Gas Production During a Conflict with Israel
In the event of an all-out war between Iran and Israel, Iran’s oil and gas production and exports could face significant disruptions, with wide-reaching implications for the global energy market.
Oil Disruptions:
Key Infrastructure Vulnerability: Iran's major oil export terminals, such as Kharg Island and Sirri Island, are critical to its export operations. These could be prime targets in a conflict, potentially halting up to 1.6-1.7 million barrels per day (bpd) of crude oil exports. Damage to these facilities could dramatically reduce the country's ability to supply oil.
Refining and Storage: Attacks on refineries in Bandar Abbas or Abadan could cripple Iran’s refined product exports, which contribute 240,000-300,000 bpd to its total oil-related exports.
Strait of Hormuz: This vital shipping lane, through which 20% of the world’s oil passes, could become a focal point of the conflict. Any disruptions here would not only impact Iran but also global energy supplies.
Gas Disruptions:
Pipeline Vulnerabilities: Iran's major gas export pipelines, such as the Tabriz-Ankara pipeline to Turkey, could be targeted. This pipeline carries 9-10 bcm/year of natural gas, a significant share of Iran’s total exports.
Domestic Gas Supply: The South Pars gas field, which powers much of Iran’s domestic energy needs, could also be disrupted, impacting 1 bcm/day of natural gas production, leading to power outages and industrial slowdowns.
Total Potential Disruption:
Oil Exports: Up to 100% of Iran's crude oil exports (1.6-1.7 million bpd) could be jeopardized.
Gas Exports: Around 17-20 bcm/year of natural gas exports, especially to Turkey and Iraq, could be halted.
Domestic Supply: Iran’s internal energy consumption could also suffer due to damage to key gas fields and refineries, causing widespread energy shortages.
This potential disruption would have significant consequences not only for Iran but for the global energy market, especially if conflict escalates to affect the Strait of Hormuz.
(anindya.banerjee@kotak.com)
In the event of an all-out war between Iran and Israel, Iran’s oil and gas production and exports could face significant disruptions, with wide-reaching implications for the global energy market.
Oil Disruptions:
Key Infrastructure Vulnerability: Iran's major oil export terminals, such as Kharg Island and Sirri Island, are critical to its export operations. These could be prime targets in a conflict, potentially halting up to 1.6-1.7 million barrels per day (bpd) of crude oil exports. Damage to these facilities could dramatically reduce the country's ability to supply oil.
Refining and Storage: Attacks on refineries in Bandar Abbas or Abadan could cripple Iran’s refined product exports, which contribute 240,000-300,000 bpd to its total oil-related exports.
Strait of Hormuz: This vital shipping lane, through which 20% of the world’s oil passes, could become a focal point of the conflict. Any disruptions here would not only impact Iran but also global energy supplies.
Gas Disruptions:
Pipeline Vulnerabilities: Iran's major gas export pipelines, such as the Tabriz-Ankara pipeline to Turkey, could be targeted. This pipeline carries 9-10 bcm/year of natural gas, a significant share of Iran’s total exports.
Domestic Gas Supply: The South Pars gas field, which powers much of Iran’s domestic energy needs, could also be disrupted, impacting 1 bcm/day of natural gas production, leading to power outages and industrial slowdowns.
Total Potential Disruption:
Oil Exports: Up to 100% of Iran's crude oil exports (1.6-1.7 million bpd) could be jeopardized.
Gas Exports: Around 17-20 bcm/year of natural gas exports, especially to Turkey and Iraq, could be halted.
Domestic Supply: Iran’s internal energy consumption could also suffer due to damage to key gas fields and refineries, causing widespread energy shortages.
This potential disruption would have significant consequences not only for Iran but for the global energy market, especially if conflict escalates to affect the Strait of Hormuz.
(anindya.banerjee@kotak.com)