Regardless of what form of government ultimately emerges in Iran, most U.S. government and oil industry analysts expect that nation to return to the ranks of the world's oil exporters as soon as stability is restored.
The major questions are how long that will take and whether the new government will let expatriate technicians return to Iran to enable it again to produce up to 6.5 million barrels of oil a day.
Whatever government ascends to power in Iran will be under enormous pressure to replace at least part of the $70 million a day the country once earned from its oil exports.
The new regime at least will have to produce an estimated 3 million barrels a day to provide enough revenues to run a government having far less ambitious plans than the shah's.
In the meantime the world's oil market has been able to live without Iranian oil -- largely because of in creased oil production from Saudi Arabia and other members of the oil cartel.
This is not to say that the shutdown in Iranian oil production has not had its effects. Prices on the spot market have spiraled upward dramatically, with one cartel member, Iraq, asking as much as $6 a barrel more than the official price. And some domestic independent refiners, such as Ashland Oil, have told the Energy Department they are having difficulty locating crude oil.
In the meantime, the Energy Department is nervously readying contingency plans to allocate oil supplies and impose mandatory conservation measures if necessary.
Energy Secretary James R. Schlesinger continues cautiously to describe the world oil situation as "serious but not critcal," saying the administration will have to make an assesment by April on whether to call for conservation measures.
The Energy Department in the meantime reports that U.S. demand for oil in January was almost the same as a year earlier.
At the State Department and Central Intelligence Agency, officials say that the actual shortfall -- because of added production compensating for Iran's loss -- is from 750,000 to 1 million barrels a day.
And in Paris, at the International Energy Agency, James Reddington said in a phone interview, "If you ask if there is an oil shortage, I would have to say that it has not been perceived yet." Reddington and other officials also report that none of the 19 industrial countries making up the IEA has pressed to implement the IEA's oil-sharing plan, and that long term contract prices for crude oil -- as opposed to spot sales -- have not been driven dramatically upward.
"The major factor so far is that the market had a lot more slosh in it than anyone predicted," says one State Department official in explaining how a serious shortage has been avoided.
Milton Lipton. a New York international oil consultant, says, "At the moment the flow of oil and consumption are not too much out of balance."
Before the disturbances in Iran, the shah's government was exporting more than 5 million barrels of oil a day. Up until mid-January it had exported an average of almost 4 million barrels of oil a day during the previous two and a half months. The last of those oil exports, however, will soon be arriving at their ports of destination.
At the State Department, officials say that the capacity to make up the difference is clearly present in the other oil-exporting countries. If most of this is tapped, the industrial countries should be able to get by with the 350 million barrels on hand in Europe and nearly 250 million barrels in storage or in transit to Japan.
"The capacity is there," says one State Department official.
Privately, however, senior administration officials fear that the Saudis may begin reducing oil production from a recent level of more than 10.5 million barrels a day. If that happens, the fear is that other Arab cartel members such as Kuwait might follow suit. Energy Department officials fear that if that should happen, and if domestic refiners have added difficulty buying oil, the department would be pressed into implementing its allocation plans, and mandating conservation measures.
"We are playing with a very thin margin," says Charles Ebinger, an international oil analyst based in Washington.
John Buckley, vice president of New England Petroleum, says, "If Iran is out for two quarters, and Saudi Arabia does cut back to 9.5 million barrels a day, there would be serious worldwide problems."
Despite public assurances that DOE is prepared to allocate crude oil and, eventually oil products, some DOE officials express fear allocation would prove chaotic.
In anticipation of possible oil allocations, a number of major oil companies, such as Standard of California, have asked for DOE permission to update their standing under oil regulations that were initially published in 1974.
Independent refiners have likewise begun appealing to DOE for protection under existing regulations that would assure them sources of crude oil or products.
All discussion of the world oil outlook, however, inevitably comes back to one point. In the words of a State Department official, "The world will not have Iranian oil again until Iran has some kind of political stability."
Secretary Schlesinger has repeatedly said that Iran may never produce as much as 6.5 million barrels of oil a day again. He says it depends on whether a nationalistic or conservative Islamic government proposed by Ayatollah Khomeini would allow the nearly 1,000 expatriates back to the oil fields.
Without the technicians, the new Tehran government would be limited to production in the range of 3 to 4 million barrels a day.
"It's tricky business. It takes people in the oil business with experience handling these kinds of situations," says an oilman formerly with Oil Services Co. of Iran, which supervised Iranian production.