GE Explores Oil, Gas Business in Iran

GE Explores Oil, Gas Business in IranGE Explores Oil, Gas Business in Iran

General Electric is exploring potential business opportunities in Iran and Lorenzo Simonelli, chief executive of its oil and gas division, visited the country recently, a company spokeswoman said.

“In line with the easing of sanctions, we have begun looking at potential business opportunities in Iran, while fully complying with the rules laid out by the US government,” a GE spokeswoman was quoted as saying by International Business Times reported.

The visit by Simonelli comes at a time when Iran is aiming to boost its crude oil exports and recover the oil market share it lost as a result of international sanctions imposed over its nuclear program.

Although some economic sanctions imposed on Iran were lifted in January, Washington still does not allow US companies to trade with Iran, unless it is through a foreign subsidiary.

London-based GE Oil & Gas, which manufactures oil drilling and processing equipment, is a subsidiary of its American parent company.

Even as crude oil prices continue to slump on the back of a massive global oversupply, Iran has signaled that it intends to significantly boost up its production capacity in the coming months.

Investing in Iran’s oil industry could help GE offset, to a certain extent, the impact of the drop in the prices of crude on its profits. In the fourth quarter of 2015, a drop in sales of its oilfield equipment ate into the American giant’s industrial revenues, which were weaker than what Wall Street analysts had anticipated.

On Monday, Iran loaded its first cargo of oil to Europe in over three years, when a tanker chartered by French energy giant Total set sail with 2 million barrels.