Iran's bargaining chip

BusinessWeek has an interesting report on Iran, which lends credence to what I mentioned recently about the way forward on that front:

Yet Iran has a surprising weakness: Its oil and gas industry, the lifeblood of its economy, is showing serious signs of distress. As domestic energy consumption skyrockets, Iran is struggling to produce enough oil and gas for export. Unless Tehran overhauls its policies, its primary source of revenue and the basis of its geopolitical muscle could start to wane. Within a decade, says Saad Rahim, an analyst at Washington consultancy PFC Energy, "Iran's net crude exports could fall to zero."
That's not to say Iran doesn't have abundant resources. The country's 137 billion barrels of oil reserves are second only to Saudi Arabia's, and its supply of gas trails only Russia's, according to the BP Statistical Review of World Energy. Getting it all out of the ground, though, is another matter. Iran has been producing just 3.9 million barrels of oil a day this year, 5% below its OPEC quota, because of delays in new projects and a shortage of technical skills. By contrast, in 1974, five years before the Islamic Revolution, Iran pumped 6.1 million barrels daily.
The situation could get even tougher for the National Iranian Oil Co. (NIOC), which is responsible for all of Iran's output. Without substantial upgrades in facilities, production at Iran's core fields, several of which date from the 1920s, could go into a precipitous decline. In September, Oil Minister Kazem Vaziri-Hamaneh suggested that with no new investment, output from Iran's fields would fall by about 13% a year, roughly twice the rate that outside oil experts had expected. "NIOC is likely to find that even maintaining the status quo is a mounting challenge," says PFC Energy's Rahim.

As I said, this story only underlines the fact that bringing the Mullahcracy to its knees should be a cinch (well, almost). That is not to say that they should be brought to their knees immediately, but if it was made much clearer - both to us and to them - that it is possible (which much of the West does not seem to realize), and that we are willing to do so if necessary, I imagine we would get a much more compliant attitude from the world's peanut gallery. It would certainly beat this approach.

Post Scriptum:
One more reason to start making clear that bad behaviour has consequences:

U.S. officials say they have found smoking-gun evidence of Iranian support for terrorists in Iraq: brand-new weapons fresh from Iranian factories. According to a senior defense official, coalition forces have recently seized Iranian-made weapons and munitions that bear manufacturing dates in 2006. This suggests, say the sources, that the material is going directly from Iranian factories to Shia militias, rather than taking a roundabout path through the black market. "There is no way this could be done without (Iranian) government approval," says a senior official.

How hard is it for the West to realise that there is only one language these autocrats understand?