TEHRAN, Sept. 14 (UPI) -- With more of its oil expected back in the global market, Iranian President Hassan Rouhani said he was cautious nonetheless about a petroleum-dependent economy.
According to the Organization of Petroleum Exporting Countries, Iranian crude oil production of 2.86 million barrels per day in August was the highest for the Islamic republic since 2013. A July nuclear agreement between Iran, the five permanent members of the U.N. Security Council, plus Germany, will eventually lead to more of that crude oil on the market.
Rouhani said existing sanctions that restrict crude oil exports to around 1 million bpd was an insult to "national honor and pride." Crude oil exports are restricted to only a handful of nations. Still, the president said the nation's economy is too dependent on oil.
"The Iranian economy is based on a single product, a problem which has not been completely resolved yet," he said.
Rouhani said about one-third of the national budget relies on revenue generated from oil. The budget for the current Iranian year, which started March 21, is the least dependent on oil revenue ever for the country, however.
Sanctions on Iranian oil exports and other parts of the economy resulted in an economic contraction of 5.8 percent in 2012-13. For fiscal year 2013-14, the World Bank estimates the Iranian economy contracted at an annual rate of 1.7 percent.
The Central Bank of Iran in March said sanctions relief would translate to about a 2 percent increase in growth, but likely not until the first quarter of 2016.
Rouhani blamed his predecessor, Mahmoud Ahmadinejad, for steering the economy in the wrong direction. The Central Bank said inflation went from a monthly rate of 45.1 percent when Rouhani was elected in June 2013 to around 15.5 percent. It aims for single-digit inflation by March 2017.