Iran: Another Day Another Cyber Attack
Cyber attacks are fairly common these days, it happens to international banks and most governmental organisations. However, the Iranian government seems to attract a higher share of cyber attacks than most other countries.
The recent cyberattack on Iran’s fuel distribution system caused a lot of pain for the Iranian people and was a major embarrassment for the government. In this attack, the system that allows motorists to buy subsidised fuel with government-issued smart cards was knocked out, which caused delays at petrol stations.
The incident exposed several structural problems within Iran's outdated energy sector. Firstly, the fact that the entire distribution of the oil products is under the control of one organisation, namely NIORDC (National Iranian Oil Refining and Distribution Company) that is under the oil ministry, makes it an easier target for cyber attacks. In most modern economies, the distribution and sale of petroleum products are either privatised or are carried out by several entities. As an example, in the UAE, there are ADNOC, ENOC, EPPCO & EMARAT chains of petrol stations and hence it will be a lot more difficult for someone or a foreign country to attack all of their systems simultaneously.
Secondly, for a country the size of Iran with its large population, the number of petrol stations (4,300) is very low. As the domestic auto manufacturing industry grows annually, the demand for petrol stations is also increasing. The government is not capable of catching up with demand and has been unable to deregulate the market. As a comparison, Iran has 25% more population than the UK and the size of the country is more than 6 times bigger but has almost half the number of petrol stations (4,300 vs. 8,380). Similarly, if we look at Iran’s neighbour, Turkey, we can see that Iran has twice the area of Turkey but one-third of its petrol stations. See Figures 1-3 for comparison.
Link to chart
To show how far behind Iran is, we can also look at the ‘density’ of petrol stations. For example, on average how many people are served by one petrol station? As can be seen in Figure 4, in Iran each petrol station is serving around 20,000 people but in Turkey, this ratio is as low as 6,500 (i.e. three times as many people).
Link to chart
Furthermore, if we look at the area covered by each petrol station, we can see that in Iran, on average one petrol station must cover 380 KM2, whereas it is less than 30 KM2 in the UK, almost 13 times less stations per KM2 (See Figure 5). We accept that large parts of Iran are deserts, but even if we discount the area of Iran’s deserts (around 20% of the land mass), we see that each petrol station would have to cover an area of more than 300 KM2, which is still not acceptable compared to international standards.
This analysis shows how sparse and vulnerable the petroleum product network is. If these structural deficiencies are not addressed by the Iranian government, we can expect more attacks and more disruptions in the future.