The National Petrochemical Company’s (NPC) loss of revenues in the fiscal 2025 amounted to $1.4 billion, mostly rooted in inadequate natural gas delivery to petrochemical units, Ali Rabbani, head of NPC’s energy optimization department said, ILNA reported.
According to the official, the figure is projected to rise in 2026 as the petrochemical companies are deprived of the much-needed feedstock they require to keep their wheels running.
“Not having access to gas feedstock has long been a thorny issue in the key sector and has turned out to be the industry’s Achilles’ heel. Getting out of the predicament is next to impossible in short term, especially in winter when the sector’s daily share of natural gas reduces to less than 5% (50 million cubic meters) of the total natural gas produced in the country, totaling 1 billion cubic meters per day.”
In cold winter days, the lion’s share of the natural gas (around 700 million cubic meters per day) is allocated to the household sector as the first priority of the National Iranian Gas Company.
Rabbani predicted that NPC’s loss of revenues in 2026 would surpass $1.5 billion as the energy imbalance cannot be redressed easily thanks to lack of investment in infrastructures. “It is with deep regret that I announce close to 22% of the sector’s total capacity, which cost $20 billion to be completed, has to be idle due to chronic feedstock shortage.”
Structural Bottlenecks
The petrochemical sector holds a strategic position in Iran’s economy, yet structural bottlenecks remain significant. To tackle the pressing feedstock challenge, Hassan Abbaszadeh, the managing director of NPC, outlined four key strategies. “Collection of flared gas in oil fields, development of upstream fields assigned to petrochemical companies, expansion of renewable energy and improved energy efficiency in the household sector are among the most immediate approaches to ensure more stable feedstock supply for the petrochem industry.”
Giving a breakdown of the ongoing projects to help the sector take advantage of its full potential, he noted that contracts were signed among domestic firms to collect 1.5 billion cubic feet of flare gases on a daily basis from oil fields in the south of Iran and inject it to petrochemical units to be converted into value added products instead of burning idly.
Moreover, he highlighted ongoing investments in gas field development, energy efficiency projects and electricity generation. By June next year, the petrochemical sector is expected to supply around 4,500 megawatts of new electricity, supporting national energy infrastructure while simultaneously optimizing gas consumption.
Abbaszadeh also added that plans are underway to optimize energy use in household sector and industries which will help save at least 100 million cubic meters of gas annually in the long term as the initiatives are implemented gradually.
Since the 2010s, Iran’s petrochemical industry has generated over $170 billion in exports. For Iran, a country endowed with significant energy resources, the petrochemical industry remains a cornerstone of economic stability and a strategic lever in navigating both domestic and global pressures.
