“The fall of the oil prices is not just something ordinary and economic, this is not due to only global recession,” Iranian President Hassan Rouhani told a cabinet session on Dec 10, 2014. “The main reason for it is (a) political conspiracy by certain countries against the interest of the region and the Islamic world and it is only in the interest of some other countries.” Rohani’s speech came hours after top-ranking officials of the US intelligence community were seen in Riyadh, Saudi Arabia’s capital.
Iran’s balanced budget actually requires oil at approx. $100 a barrel, and authorities in Tehran think Saudi Arabia is behind OPEC’s decision not to cut oil supply with a view to challenging Iran’s rising influence in the Middle East. Riyadh seeks to push Iran’s economy to the limit, hoping it will draw the Iranian government’s attention on domestic issues rather than on foreign issues like Iraq and Syria.
Analysts believe Iran will be unable to sustain more than 6 to 12 months with a barrel under $70 without major consequences, hence “increasing the share of non-oil exports in (Iran’s) economy is among (government’s) major targets for the next year.”