The Weapon Iran May Not Want to Use

Mere tension between Tehran and the West has added, by some estimates, $10 to $15 a barrel to the price of crude oil. That's been a boon to Iran, which announced on Tuesday that its oil revenue this year would hit $55 billion, up $10 billion from the previous year. Every day, Iran is making $156 million in oil sales.

Youssef Ibrahim, a longtime journalist and consultant on Middle East oil-producing nations, said: "They've got the oil weapon now. This is the ideal situation for them." Iran could also disrupt oil exports by other countries in the Persian Gulf, either by mining the gulf, firing a missile or simple sabotage; even if the damage were slight, a spike in insurance rates would effectively shut down much of the oil exports in the area. Outside the oil markets, Iran could also foment greater violence or unrest in Iraq and Afghanistan.

Some people familiar with Iran believe cooler heads among the supreme religious clerics will prevail and that Iran would not use the oil weapon unless the United States launched a military attack. "When it gets down to their sources of revenues, they get pretty conservative," Sick said. "At the time of the revolution they behaved differently, but they discovered that that didn't work. They've been trying very hard to put themselves back on a rational basis."

Many Iran experts believe oil is more of a shield than a weapon.

"I think that the issue of Iran using oil as an economic weapon has been highly exaggerated," said Abdulsamad al-Awadi, the former head of European operations for Kuwait Petroleum Corp. "From talking to a lot of their officials, I don't believe that they would use the oil weapon unless they were attacked."

Al-Awadi doubts that the United States could convince other countries to impose economic sanctions. "Iran is not North Korea, which can be isolated," he said.

Iranians themselves seem worried about possible conflict, as well as about Ahmadinejad's ideological criticisms of the stock market and banking system. Iranian government officials have told foreign consultants that about $200 billion has flowed out of Iran to overseas money centers such as Dubai in the United Arab Emirates. The Iranian stock exchange has dropped 7.5 percent this year, on top of double-digit declines last year, despite the tremendous inflow of money from oil sales. Every other stock exchange in the region has risen sharply.

Meanwhile, the signals from Iran's government remain mixed. While some Iranian officials, including the oil minister, have played down the likelihood of restricting oil output, other Iranian officials have kept that tension high. "If sanctions are imposed, we will definitely use the oil tool and other tools and we will stop at nothing," the interior minister, Mostafa Pourmohammadi, told reporters in March. Last week, the country's chief nuclear negotiator, Ali Larijani, told a news conference, "We are not interested in using oil as a weapon . . . but if the conditions change it could affect our decision."

Staff writer Dafna Linzer contributed to this article.