U.s. Puts The Squeeze On Iran's Oil Fields

In a report published this month by the National Academy of Sciences, Johns Hopkins University geography professor Roger Stern argued that the confluence of high domestic demand, a delay in adding production capacity, the diversion of natural gas to keep wells producing and other factors could lead to a decline of 33% to 46% in Iran's exports by 2011 and a halt to exports by 2015 or so.

Other analysts have said those forecasts are too dismal, and output is more likely to remain flat at about 4 million barrels a day. Iranian officials say they have signed $28.4 billion worth of new oil and gas development contracts over the last 15 months, and hope to increase production to 7 million barrels a day by 2014 -- a goal that the International Energy Agency says will require $80 billion in investments.

The nuclear issue

Whether that will be realized could depend, in large part, on what happens on the nuclear issue.

In fact, Iran's oil and gas dilemma appears to point up a "genuine" need for civilian nuclear power, Stern said.

"When I first started hearing this claim that Iran needed these nuclear plans to substitute for oil and gas, I thought, 'That's ridiculous,' " he said. "So it has really been a surprise to me," he added, to see evidence that Tehran's stated purpose for the nuclear reactor is not "simply a weapons deception."

"I don't think they're nice guys," he said. "This is a regime that funds terrorism and is making outrageous claims that Israel should disappear. But it just happens to be a convenient truth for them that they do need nuclear power."

kim.murphy@latimes.com

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Oil giants

Iran is one of the world's biggest producers and exporters of petroleum and has the third-largest proven reserves:

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Top producers, 2005*

(millions of barrels per day)

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Saudi Arabia: 11.1

Russia: 9.5

United States: 8.2

Iran: 4.2

Mexico: 3.8

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Top exporters, 2005

(millions of barrels per day)

*--* 1. Saudi Arabia 9.1 2. Russia 6.7 3. Norway 2.7 4. Iran 2.6 5. United Arab Emirates 2.4

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Crude oil reserves, 2006

(billions of barrels)

*--* 1. Saudi Arabia 266.8 2. Canada 178.8 3. Iran 132.5 4. Iraq 115.0 5. Kuwait 104.0

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*Production includes crude oil, natural gas liquids and other products

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Source: Energy Information Administration. Graphics reporting by Tom Reinken