Chamber of Commerce Report on Severe Losses in Iran's Petrochemical Industry Due to Gas Shortage

As the cold months approach and Iran transitions from a summer electricity crisis to a winter gas crisis, the Iranian Chamber of Commerce has warned about the severe losses caused by the gas shortage in the petrochemical industry. According to a report prepared by the Research Center of the Iranian Chamber of Commerce, one-fifth of Iran's petrochemical capacity is unused, with over 62% of that due to a lack of gas feedstock. The Chamber stated that nearly 15 million tons of petrochemical products are lost annually due to the gas feedstock shortage: 'The loss of not selling gas at higher prices to petrochemicals amounts to about $500 million for the government, the loss of profits for petrochemical units is about $200 million, and the reduction in petrochemical exports is approximately $1 billion due to the gas shortage.' The statistics from the Chamber of Commerce are mainly based on the performance of the years 1400 and 1401 (2021-2022), while official customs statistics indicate that last year's situation was much worse than the Chamber's estimates for those years. According to these statistics, in the year 1402 (2023), about 49 million tons of petrochemical goods worth $19.4 billion were exported, showing a decrease of 11% in weight and 29% in value. The amount of gas flared in Iran is equivalent to 40% of Turkey's gas consumption. The Chamber of Commerce pointed out the massive loss of gas produced in the production phase and stated that if the government had prevented this waste, the gas could have met the needs of the petrochemical industries. The latest World Bank statistics indicate that Iran flared over 21 billion cubic meters of gas produced from oil fields last year due to the lack of gas collection equipment, resulting in a loss valued at over $6 billion. Statistics from the International Energy Agency also show that about 8 billion cubic meters of Iran's produced gas is lost annually during refining and transportation due to leaks. In other words, gas losses in Iran exceed the total gas consumption of the petrochemical sector. Additionally, Iran's gas losses are equivalent to twice the gas consumption of the steel sector, four times that of the cement sector, and three times that of the transportation sector. In the summer, Iran faces a massive electricity shortage, reducing electricity supply to industries by half, and in winter, it faces severe gas shortages, limiting gas supply to the industrial sector. The enormous losses from the gas shortage on industries come at a time when estimates from the Iranian Chamber of Commerce, the National Development Fund, and the Research Center of the Parliament indicate that the country's gas shortage will significantly increase in the coming years, and by the year 1420 (2041), the government will practically be unable to meet two-thirds of the country's gas demand.