Editorial: The Hydra Of History & Doors Slamming In Iran

The past week saw a historic event unfold in Switzerland’s Jura Mountains: the signing of an accord to limit the scope of the Iranian nuclear programme.

Delegates of the so-called "P5+1" - a conglomerate of six nations that began negotiation with the Islamic Republic of Iran in 2006 over their nuclear ambitions – agreed to a Joint Comprehensive Plan of Action to bring the pariah state in from the cold wastes of international eschewal.

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As predicted, the mollification of sanctions on Iran will release as much as 500,000 barrels per day (bpd) by the end of the 2015, should the stipulations of the plan be met in full. Although this would represent only 0.5 per cent of the world’s daily crude output, the markets were spooked into a five per cent drop after the settlement was announced.

Iran’s Foreign Minister, Mohammad Javad Zarif, received a hero’s welcome as he returned from the Lausanne brokering table. His country’s economy was on the brink of collapse, with 75 per cent of small and medium-sized enterprises (SMEs) folding since inflation hit 25 per cent in 2012.

In the same time period, the world’s fourth largest holder of crude oil has seen its daily production rates slip to less than half of 2012 levels, and one sixth of the highest daily average of 6.02 million bpd in 1974.

Yet whilst dialogue has been fruitful in the nuclear domain, let us not forget the many heads of the hydra of history. Operation Decisive Storm, the Saudi-led military intervention of Yemen, has served to stoke the suspicion of Iran’s influence within the country’s Houthi insurgency.

Direct ascription of involvement in a conflict that has caused the deaths of as many as 25,000 people and the displacement of some 300,000 Yemeni and Saudi citizens would be tantamount to opening the door just to be able to slam it…

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Tim Haðdar is the Editor In Chief at Oil & Gas IQ. Reach Him At Twitter Or OGIQ