Reuters reported last week that Iranian oil exports “have surged to their highest in 20 months” – far above the “sanctions cap” outlined by the interim Joint Plan of Action (JPA) that granted financial relief to the Islamic Republic – per revised estimates for February global crude imports published by the International Energy Agency (IEA).

“The question is whether they are going to continue to test the sanctions,” said Antoine Halff, head of the IEA’s oil industry and markets division.

“It’s possible that Iran’s exports will plunge below 1 million bpd this spring and summer, enabling the cap to be met,” said Bob McNally, president of energy research group the Rapidan Group, who served as White House adviser to former President George W. Bush.

“But in my view, it is more likely that Iran’s customers have seen the writing on the wall and concluded they can import more Iranian oil at lower risk of being sanctioned by the State Department.”

The description is in line with long-expressed fears that the JPA’s partial erosion of the sanctions regime would trigger a kind of gold rush that further undermined the rest of the regime. Foreign policy and energy analyst Aaron Menenberg had already last January outlined fears that a scramble to access Iranian energy – in which “no company wants to be the first one in, but none want to be the last” – could trigger such a downward spiral.

Iran’s Fars news agency boasted on Friday that Iranian electricity swaps have been steadily growing, and that Iran’s electricity exports have increased 40% since late March.

The news comes alongside deepening analyst concerns that the value of Iran’s allowable trade under the JPA – even putting aside cheating on export limits and the potential for further erosion – had already been dramatically underestimated by the Obama administration.

[Photo: Columbia SIPA / YouTube]