  Other Pages  Policy Analysis  PolicyWatch 2062  Iran Beyond
Oil?  Patrick Clawson  Also available in العربية  April 3, 2013
The role of oil in Iran's economy is declining, undercutting
Western efforts to press the regime by reducing its oil export
revenue.  The image of Iran's economy as oil, carpets, and
pistachios was always flawed, but has now become badly dated.
The Islamic Republic is in the midst of a non-oil export boom --
it has the potential to remain a middle-income country even with
no oil exports, and the reserves to finance the transition in
the meantime. For years, Iran's leaders called for reduced
reliance on oil but did little to meet that goal. Western
sanctions have seemingly spurred them to action -- in his annual
Nowruz address on March 21, Supreme Leader Ali Khamenei
acknowledged for the first time that restrictions on the
country's oil exports had made a serious impact: "The sanctions
have had an effect, which is because of an essential flaw that
we are suffering from. The flaw that o