Iran may have oil options to drag things out

Iran has more cards to play to avoid the U.S. blockade halting its oil output — at least for now, analysts say.Why it matters: Oil is Iran's economic lifeblood, and President Trump hopes blocking exports — which eventually causes production to halt — will force concessions.But Iran has extra storage capacity, and reportedly can get some tankers through the blockade — so it may be able to resist that pressure for a while longer.The state of Iran's oil infrastructure could sway regime strategy as the Strait of Hormuz stalemate creates political pain for Trump.What they're saying: The country may not be in imminent danger of a major crude oil shut-in, writes Antoine Halff, chief analyst with the climate and energy data analytics firm Kayrros. Halff cited Iran's experience in building stocks during the Covid crisis, available space at other facilities, and efforts to increase alternate storage and export facilities over the past 10 years.That's from his forthcoming blog post for Columbia University's energy think tank. The big picture: Gregory Brew of the Eurasia Group challenges estimates in mid-April — when the blockade began — that Iran only had enough storage to maintain production for two weeks. That estimate presumed Iran wouldn't be able to export oil during this time, said Brew, a senior analyst with the political risk consultancy.That presumption, he and others say, has not been borne out. The intrigue: Brew said that Iran is capable of halting production without catastrophic loss of pressure in the fields.He also argues the powerful Islamic Revolutionary Guard Corps has other revenue sources, like smuggling oil overland and in small tankers.Even if the US blockade is completely successful — and, importantly, right now it isn't — IRGC would be able to rely on these alternatives to keep its troops paid and its position in Iran secure, he said via email.Zoom in: Iran had access to 20 Very Large Crude Carriers — the kind of ship that holds 2 million barrels — as of April 20, per Rohit Rathod, a senior analyst with commodity tracking and analytics firm Vortexa.These vessels can be easily repurposed by Iran to be used as floating storage and keep producing for about 2 months before Iran must curtail oil production, he said via email.The firm also estimates that as of April 20, Iran had spare onshore storage equivalent to around three weeks of production.The other side: Treasury Secretary Scott Bessent claimed production shut-ins have begun, and calls the blockade a one-two punch with sanctions.Miad Maleki, a former Treasury sanctions official now with the hawkish Foundation for Defense of Democracies, said in a detailed X post that Iran's storage strategy is delay tactics measured in days, not weeks.Catch up quick: The throttling of the strait has prompted multiple Persian Gulf states, lacking export routes, to pare back output.Reviving production while avoiding long-term well damage is tricky.It's one reason markets will be far from normal even once the strait opens. Trump even claimed Iran's pipelines are at risk of explosion.What we're watching: Iran's pain threshold.Sign up here for Axios' Future of Energy newsletter.