Iran: Private sector exports first oil consignment

The Iranian private sector was reported in early September to have delivered the first consignment of crude oil via non-Iranian tankers to foreign buyers. Hassan Khosrojerdi, the head of the union of Iranian exporters of oil derivatives, said a private company had sold the consignment to an international client, emphasising that no discounts has been given over the trade.

The payment was used to settle Iran's debts. No cash was received from the client. And in mid-September some Iranian private-sector companies reached deals to sell two consignments, comprising four million barrels of oil, to international clients. The crude will be delivered in the Persian Gulf.

Khosrojerdi nevertheless complained that the Central Bank of Iran (CBI) is refusing to deliver on its promise to finalise the legal framework pertaining to private sector sales of crude. This development shows that Iran still has the ability to sell its oil, even under the current sanctions regime. Nevertheless, the volumes through such clandestine channels cannot be large, and it is not clear how long Iran will be able to maintain this strategy.

The US Treasury and related institutions in the United States are trying to close all loopholes through which Iran can funnel its crucial petrodollars home.

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© 2012 Menas Associates