Amid a steep fall in global oil prices, the Islamic Republic President Hassan Rouhani claimed on Wednesday that Iran's losses would be "much less" than other producers.
Given that Iran's daily oil exports have dropped from 2.5 million barrels a day before the U.S. sanctions to about 140,000 barrels a day, Rouhani's remarks may be convincing at first glance. But Iran still exports about half a million barrels of oil products per day, as well as diesel, fuel oil (mazut), liquefied natural gas, etc., It also exports about 48 million cubic meters of natural gas. The prices of all these products depend on the price of crude oil.
In addition, when Iran was drafting its budget it made optimistic predictions on crude prices and the volume it would be able to sell. In its budget (March 20, 2020-2021) revenue projections the price of crude oil has been set at $50 a barrel, meaning more than $18 billion is expected from oil exports. But if oil prices and the volume of oil exports remain at the current level, Iran's income from selling oil would hardly reach two billion dollars this year.
Moreover, Rouhani's administration has included $ 4 billion in natural gas exports in its budget, which is seventeen percent more than last year. This year's budget also includes 890 trillion rials (about $21 billion) of exports of oil products, which is twice as much as the previous year.
Nonetheless, according to the International Monetary Fund's estimate, even if Iran can export 340,000 barrels of crude oil a day, the price of oil needs to be $398 per barrel to prevent a budget deficit, otherwise, the country's total budget deficit will amount to 9.9 percent of Iran's gross domestic product.
Iran's GDP is estimated at $ 439 billion this year, so the country's overall budget deficit is expected to be $ 43 billion.