Iran - now it gets harder

Iran has made the big post-sanctions output gains. Now it must make its upstream attractive to outside investors

In October, Tehran signed the first upstream deal under its new Iran Petroleum Contract (IPC). The identity of the counterparty was not the expected foreign oil company-but instead a local firm, Persia Oil & Gas Industry Development Company (POGIDC), a subsidiary of Supreme Leader Ali Khamenei's Setad, a holding company. It was a sign of progress. Then, at the end of November, Iran agreed to a new Opec quota from January 2017 of 3.797m barrels day. That's a virtual cut from the near 4m b/d Iran claims as its baseline, but 90,000 b/d more than it produced in October. A political fudge therefore allows for Iran to keep adding output. Since sanctions were lifted in early 2016 production has