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Development of oil industry as one of the modern strategies to deal with poverty and unemployment along with activities such as agriculture and manufacturing industries in villages can be an important strategy for the development of village and prevention of rural migration to cities. The aim of this research was investigation of the effects of oil exploration on rural resident welfare (Lavan Island). The research was conducted in the form of a survey study. The population of the study included two sectors: the managers and rural residents in Lavan Island. The necessary data for this research were collected from by 135 (with the use of Cochran formula) rural residents in Lavan Island, they were sampled by using a random sampling method. The reliability of questionnaire was calculated by Cronbach Alpha coefficient for different sections after conducting a pilot study for each structure separately calculated: economic factor 0.96, social - 0.944, and culture - 0.928, respectively. The results of this research showed that the oil industry could improve the rural development process in rural areas: improve the employment, education, family relationship, and better access to water and electricity. The factor analysis results showed that the positive effects of oil industry development could be: economic, social, cultural, and physical factors. These four factors have explained 62% of total variance. [ABSTRACT FROM AUTHOR]