Last week at the meeting in Lausanne (Switzerland) the United States and five other world powers reached a provisional agreement with Iran to scale back its nuclear program significantly for 10 to 15 years and accept intense international inspections. In exchange, the United States and the international community would lift most of the sanctions that have punished the Iranian economy.
Since 2011, the EU and US have imposed almost total embargo on Iran’s foreign trade and financial transactions, frozen the assets of Iran’s central bank, isolated Iran from the international financial system by disconnecting it’s banks from the SWIFT. As the result, Iran's economy shrank about 10% in real terms despite the current account surplus; inflation skyrocketed to 41% in 2012 and Iran tumbled to 83d place in the global competitiveness ranking from the 62d. External sanctions affected almost every significant aspect of the country’s economic, infrastructure and social developments (see the data from the latest Global Competitiveness Report on the charts below).
Event Holder: Organization of the Petroleum Exporting Countries
Passage of the deal probable, but will be followed by a flury of proposed legislation designed to undermine the deal.
Global oil production remains strong even as some leading industry forecasts suggest that global economic conditions will override low global oil prices to constrain oil demand growth this year.Some leading OPEC producers, including Iraq, Kuwait, and Saudi Arabia, are producing at or near record levels, largely offsetting production declines from several OPEC and non-OPEC producers. Many of these OPEC members have relatively low operating costs or are on the upside of years of development to bring online new production and thus may not reduce production in the face of the oil price slump to retain their market shares.In contrast, other major...