A Paper Tiger?
ONE OF THE premises of the debates over how to handle Iran -- a premise shared by the administration and its critics alike -- is that the Islamic republic is a power in ascension. The Iraq war has eliminated its major regional rival. Shiite co-religionists with Iranian backing are vying for power in Iraq and Lebanon. Oil prices are high, the United States is distracted, the Russians are helpful, and the Europeans are pushovers. This, everyone seems to agree, is Iran's moment. But what if the notion that Iran is operating from a position of strength turned out to be a false premise?
That's the question posed by a fascinating and provocative new study of the Iranian oil industry published by a scholar named Roger Stern. An economic geographer at Johns Hopkins University, Mr. Stern contends that the Iranian oil industry is actually in something of a death spiral. Iran has been missing its OPEC quota of late, and while high oil prices have masked the decline by keeping revenue up, production has been declining. Higher domestic energy demand in Iran combined with difficulty in attracting foreign investment and other economic problems, he argues, make a rapid decline in oil exports likely -- ending in the "extinction" of Iranian oil exports in 2014-15. If anything such as this is true, a huge component of the Iranian puzzle is being systematically overlooked.
Mr. Stern, writing recently in the Proceedings of the National Academy of Sciences, believes that the Iranian infatuation with nuclear energy may have its roots in this crisis, as well as in its desire for nuclear weapons. Increasing domestic use of nuclear energy would free up oil and gas, currently being used to satisfy Iran's electricity needs, for export, he argues. The major implication of his analysis, however, may be that Iran's regional power is being overestimated, that even without American or international intervention, Iran faces a reckoning soon as its major source of international money collapses.
We don't know whether Mr. Stern is right. The paper assumes that the country's leadership will be unable to meet the challenge of modernizing and expanding production facilities and that Chinese investment won't be available to ensure that exports continue at the rate China's own increasingly voracious appetite for oil requires. What's more, even if Iran faces major problems, it's not clear that would make it less dangerous or more pliant to international will. It could do the opposite.
But Mr. Stern's paper represents a refreshing examination of the suppositions that lie beneath current discussions of the Islamic republic. One of the intellectual failures in the run-up to the Iraq war was the absence of such examinations both within the intelligence community and in the political culture at large. Mr. Stern's challenge is valuable and worthy of serious response.