Oil was first produced in Iran at
Masjed-e-Soleiman (near Dezful, in the south-west) in 1908, and initially exploited on a
large scale by the Anglo-Iranian Oil Company after W.W.I. Abadan proved early on to be the
most prolific site, and it was no long before it became a virtual colony of the
international oil companies. However, the oil companies were nationalized by the Iranian
government in 1950 (an annual public holiday celebrates the fact). Oil is currently
drilled in south-western Iran, and in the Persian Gulf; and sent to refineries near
Tehran, Tabriz, Arak and Esfahan.
Iran is currently the
world's third-largest exporter of oil (after Saudi Arabia and Norway). Despite the
low-grade output, which is unsuitable for some countries, and the US embargo, oil is
overwhelmingly Iran's major export earner - it accounts for more than 40% of all
government income. 
In accordance with quotas set by the Organization of Petroleum-Exporting Countries OPEC , Iran produces 3.6 million barrels per day, of which about 2.5 million is exported for about US)$27 per barrel. Iran has an estimated 90 billion barrels left , about 10% of the world's reserves. At this rate, however, supplies will run out after 70 years.
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