Political turmoil slows big oil moves in Iran

DUBAI (Reuters) – Political upheaval in the aftermath of Iran’s disputed presidential election has slowed international oil firms’ efforts to find a way through sanctions to invest in the world’s second-largest oil and gas reserves.

Just a few months ago, overtures to Tehran from the United States under President Barack Obama had the world’s most powerful energy companies reassessing the risks of working in Iran and optimistic the shadow of sanctions might start to lift.

But outcry following the June election stirred the biggest internal crisis since the 1979 Islamic revolution, slowing Iranian bureaucracy and spooking dealmakers in big oil firms.

“It’s hard to slow down a turtle, but this has,” said an executive at an international oil company (IOC) on condition of anonymity as he was not authorised to speak publicly. “This has put everything into freefall, no decisions are being made.”

In the first months of Obama’s presidency, energy firms stepped up contacts with Iranian oil officials hoping that with or without President Mahmoud Ahmadinejad, U.S.-Iran relations would improve. But tentative rapprochement has ended, and executives are back to playing a tricky holding game.

Reuters