Iran halves oil production and increases defense budgets in its new budget

Iranian President Ebrahim Raisi presented a draft budget for the fiscal year 2022-2023 to parliament on Sunday, which includes halving oil production and focuses on defending against US and Israeli sanctions and threats.

The draft budget for the Iranian New Year, which starts on March 21, is due to be voted on by the end of December. Tehran provides in its budget economic growth of 8%.

The document indicated that Iran intends to produce 1.2 million barrels of oil per day and sell it for $60 per barrel, while last year it expected to produce 2.3 million barrels per day at $40 per barrel, according to the Tasnim agency.

Therefore, it is expected that Oil revenues drop from $33.5 billion to $26.3 billion.

Oil experts believe this estimate is very high, as Iran is currently selling around 600,000 barrels a day. Oil revenues will account for a quarter of budget revenues, while another quarter will come from taxes, which have risen sharply.

The other important aspect of the project is that of defense, with growing threats from Israel and the United States to resort to the military option against Iran.

According to the document, the amount allocated to the “program for strengthening defense capabilities and strategic research will reach 4.5 billion euros”, after the defense quota amounted to 4 billion last year.

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