Iranian Billionaire Sentenced to Death for Oil Embezzlement

It’s no secret that punishments can be harsh in the Middle East, as proven by a recent sentence handed down to Iranian billionaire Babak Zanjani. After being found guilty for helping Iran evade oil sanctions, Zanjani was sentenced to death for embezzlement.

Along with two accomplices the Iranian court accused the tycoon of “spreading corruption on earth.” Authorities maintain that he played a major role in helping the government evade oil sanctions, an act that falls into the court’s definition of a capital offence. As well as repaying funds embezzled from entities such as state-run National Iranian Oil Company (NIOC), the defendants will be executed for their actions.

“The court of first instance ... sentenced the three defendants to death,” commented judiciary spokesman Gholamhossein Mohseni Ejei.

Swindling the government out of cash

For years, Zanjani put together multibillion dollar oil deals on behalf of a network of companies. Spanning from Malaysia, Turkey, the UAE and beyond, the deals earned him a fortune of over £7 billion. Now, it appears that the deals were far from clean. After he was arrested in 2013, a judicial spokesman revealed that the court suspected “he received funds from certain bodies ... and received oil and other shipments and now has not returned the funds.” According to prosecutors, the figure owed to the government is in excess of US$2.7 billion.

For Iran, it’s a major blow to its re-emergence as a global oil entity. In January the nation surfaced from years of economic isolation after the US and EU lifted sanctions against Tehran. Needless to say, Zanjani hasn’t inspired a glowing start.

The future of Iran’s newly unlocked oil and gas economy

With the sanctions newly lifted, analysts are forecasting a significant rise in Iranian oil output. In turn this could boost its gas production industry, and aid the nation in harvesting its 29.6 trillion cubic metres of natural gas reserves.

Should this come to light, the nation’s gathering lines could start to reach capacity. For more acumen into what this could mean for producers, ‘Capacity Allocation and Nominations’ offers detailed insight.  The issue is currently being experienced by a number of US shale producing areas such as Williston Basin, Eagle Ford, Marcellus and Utica, where lines have hit full capacity due to increased production. President of Oil & Gas Training Corporation (ONGT) Jane Williams offers expert commentary on how to manage the issue, including processes of nominations, system balance, pressure information and communications.

Image via Flickr Creative Commons. Photo credits: Tex Credits