President Mahmoud Ahmadinejad Says Oil Embargo Won't Hurt Iran Faced with diminished demand for Iranian oil because of economic sanctions, Iran's president proclaimed defiantly on Tuesday that the country had such plentiful reserves of money that it could survive for years without exporting any oil. Coming a few days before the resumption of talks with world powers over Iran's disputed nuclear program, the assertion by the president, Mahmoud Ahmadinejad, seemed partly an attempt to convey a message of political and economic strength to a domestic audience. Ordinary Iranians have suffered increased deprivations because of the sanctions, which are intended to punish Iran for enriching uranium that the West suspects is a cover for developing the ability to make nuclear weapons. Iran insists that the program is peaceful. The sanctions have severely disrupted the country's banking system, contributed to rising inflation and threatened further upheavals when a European embargo of Iranian oil is enforced starting July 1. Iran is the second-largest producer in the Organization of Petroleum Exporting Countries after Saudi Arabia, and oil exports account for roughly 80 percent of its foreign revenue. But even before the oil embargo goes into effect, European purchasers of Iranian oil have started buying elsewhere, and recent oil industry reports suggest that Iranian exports have fallen substantially, to 1.9 million barrels in March from roughly 2.2 million barrels in February. Iranian oil officials have insisted that they will have no problem selling their oil. The oil minister, Rostam Qassemi, said Tuesday in remarks carried by the official Islamic Republic News Agency that despite the European Union embargo, "Iranian oil has high economic value, and the international oil market would never neglect it." The semiofficial Fars News Agency quoted Mr. Qassemi as saying, "Despite sanctions and threats, we have no problems in upstream oil industries, including production, and therefore we can say today: Goodbye, sanctions." The minister also said Iran had stopped exporting oil to Greece, and Iran's state-run Press TV Web site said supplies to Spain had also been cut. Mr. Ahmadinejad took a different tack of defiance in a speech in southern Iran. In remarks reported by Iranian news agencies, he ridiculed the West for thinking an oil embargo could work. "We have as much hard currency as we need and the country will manage well," Mr. Ahmadinejad said, "even if we don't sell a single barrel of oil for two or three years." Experts on Iran's economy dismissed the president's assertion as political propaganda, saying it would be physically impossible for Iran to handle such a shock. For one thing, they said, Iran's oil industry is vital for employment inside the country and its fields must keep pumping, but the country does not have the storage capacity to warehouse an accumulation of extracted oil that is meant to be exported. "There is no way it could be absorbed inside Iran," said Kamran Dadkhah, an associate professor of econometrics at Northeastern University in Boston. Mr. Dadkhah said the Iranian president's boast was meant to convey an assurance that the country had stockpiled a huge reserve of foreign currency, which some estimate at $90 billion, to weather restrictions to its oil exports. Others said Iran's inability to sell oil still loomed as a domestic crisis. Djavad Salehi-Isfahani, an economist at Virginia Tech, estimated that the European oil embargo and other sanctions endangered perhaps 50 percent of Iran's oil exports, which could cut more than $30 billion in annual earnings. "It would be a huge shock to their fiscal and trade systems," he said.