If US President Donald Trump is right, the Iranian oil industry should be imploding by now. On April 26, he predicted the country's wells would "explode" in a "very powerful" destructive process starting in three days. That's today. Considering oil is central to the war, one would hope Trump has his facts right. Unfortunately, he doesn't.
Trump has gambled that the US naval blockade, which began more than two weeks ago, would stop Tehran's tankers from reaching the high seas, depriving the regime of at least $175 million a day in oil export revenue. Unable to ship its crude, Iran would soon run out of storage, forcing the Islamic Republic to close the taps. Crucially, the president is convinced that shutting the wells would damage them irreparably. "When it explodes, you can never, regardless, you can never rebuild it the way it was," he told Fox News in an interview, adding that capacity would be reduced to "about 50% of what it is right now."
The petroleum engineering facts are, however, far more complex than the White House's rose-tinted narrative. Put simply, the Iranian oil industry isn't about to implode (unlike the Organization of the Petroleum Exporting Countries, which faces an existential crisis after the United Arab Emirates decision to quit the cartel after six decades of membership to gain the freedom to boost output). Still, Trump appears to have decided to keep the blockade in place, hoping it will end the stalemate at the negotiating table.
Before the war started, Iran was pumping about 3 million barrels a day of crude, plus another 750,000 barrels of a light oil called condensate1. With local demand running close to 1.9 million barrels, that leaves Iran with a daily surplus of about 1.85 million barrels a day. With the blockade in place, those barrels are heading into storage.
Helpfully for the Islamic Republic, it has more onshore and offshore capacity than most of its neighbors, giving it time before its tanks are full. Even two weeks after the blockade started, it's still loading crude from its Kharg Island terminal into ships that were already in the Persian Gulf. Sure, Tehran is now relying on relics of questionable seaworthiness to do the job, but those aging tankers will help for a while. Kpler, a commodity-intelligence firm, reckons that Iran probably has another 12 to 22 days of storage available, far more than the US administration anticipated when it started the blockade. If Trump was right, Iran would have run out of storage today.
The Islamic Republic won't wait until the last minute, however. Instead, it will pre-emptively slow production well before it runs out of storage; engineers prefer to gradually throttle down wells rather than shut them suddenly. The process appears to be already ongoing, with visible oil and gas flaring in Khuzestan, the heart of the country's petroleum industry (the extra flaring signals all of a well's output can't be evacuated). By mid-May, Iranian oil production will need to halve from pre-war levels as storage reaches its limit, with only domestic demand and some residual trade via trucks, rail and coastal ships in the Caspian Sea acting as relief valves.
The economic blow would be immense as the country loses crucial oil revenue. But I don't buy the argument that its oil wells would suffer irremediable damage -- and neither do most experts with on-the-ground experience in the petroleum sector. Sadly, the US administration appear to be relying on flawed analysis, often amplified in social media and derived from Claude, ChatGTP and other artificial intelligence models. The state-owned National Iranian Oil Company has plenty of experience throttling production up and down; a stoppage lasting weeks, or even a couple of months, would not be enough to condemn the wells.
Along with most of the Persian Gulf, Iran pumps from carbonate-rock reservoirs. Because oil was discovered there earlier, its fields are more mature, and many suffer from relatively low pressure. The combination makes its wells more fragile than, say, those in Saudi Arabia or the United Arab Emirates, but not much than those in Kuwait and Iraq, and you wouldn't hear anyone at the White House saying the oil industry of those allies is about to explode. Importantly, petroleum engineers can take mitigating action to avoid damage. As well as throttling production, they can rotate shutdowns between oilfields. The key is keeping the wells flowing for as long as possible, avoiding problems, such as water intrusion, that accompany long-lasting closures.
Back in 2019-2020, during the first Trump administration, Iran had to cut production significantly but was able to restart its wells without significant problems over the next few months, eventually lifting total petroleum output in 2025 to a 46-year high. That recovery is the best indication that talk about permanent damage is wishful thinking. The 2020 experience is invaluable now as the country's engineers will have learned from previous mistakes. In some ways, the maximum pressure campaign of five years ago means that Tehran is better placed today to survive the blockade.
For sure, Iran is likely to incur extra costs as a result of the disruption to output, and the amount of oil it can eventually recover from its reservoirs may be lower than otherwise -- but that's a problem for 2035, 2040 or even 2050, not 2026.
Iran is under pressure economically, but the blockade is unlikely to deliver the silver bullet that Trump yearns for. For some hawkish policymakers and analysts, the economic damage is good enough, but it's important to remember that the blockade is a means to force Iran to negotiate, not an end in itself. Viewed through that lens, it hasn't delivered what the White House wants. And it probably won't.