Abstract
Despite its gigantic energy reserves and its privileged position in the region, the Islamic republic is not in an enviable position. The country’s economy is woefully mismanaged; it is not only fraught with thorny problems of double-digit inflation, high unemployment, and sub-par growth, but also vulnerable to unpredictable oil price downfalls and serious universal sanctions. Ironically enough, its future self-sufficiency in either fuel products or natural gas is questionable. Iran still needs the world markets much more than the latter needs Iran’s oil and gas.
Furthermore, the world could cope without Iran’s energy exports through national strategic reserves, the use of excess capacity in other oil-rich countries, further energy-saving devices, use of alternative sources, and, if need be, higher prices. But, Iran’s desperate need for oil export  revenues to finance its essential imports (including refined oil products) and pay for ordinary government expenditures disallows even a fairly temporary interruption.
Undue confidence in large energy reserves as a dominant force has also led the Islamic republic to defy international community on the matter of uranium enrichment at its own peril. It has also tempted President Ahmadinejad to engage in such empty boasts as calling Iran “a powerhouse on the global level: capable of providing a “globlal plan to handle world problems”-thus making the Islamic republic the subject of worldwide ridicule. Heretical as it may sound,one may wonder whther endowment with more irrigation water and vastly more arable land, instead of oil and gas, would have led to a better social, economic, and political situation for Iran.