Iran Makes First Oil Discovery In Caspian Sea In 100 Years

Iran announced this week that it's made its first oil discovery in the Caspian Sea in more than 100 years.

The semiofficial Fars News Agency reports the find, in ultradeep waters, may hold the equivalent of 7 percent of the country's known national reserves.

Iran has touted its ability to continue with domestic energy production, notably in the South Pars natural gas field in the Persian Gulf, despite international sanctions targeting its energy sector. In the Caspian, however, Iran's recent claims may put it at odds with its neighbours over their rights in disputed territorial waters.

Iranian officials reported the discovery of an oil field containing as much as 10 billion barrels of crude oil in the waters of the Caspian Sea.

The find was reported at a depth of around 1.5 miles, however, and Iran seemingly has little experience with deepwater development.

With Iran facing a diminishing consumer base because of European sanctions, the find, if correct, could be used as political capital by Tehran should global oil supplies constrict when international sanctions take hold later this summer. Iran insists the world needs its oil and 10 billion barrels of new oil in its pocket certainly makes for attractive bargaining.

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