Iran, the second-largest oil
producer in OPEC, wants to “move away” from taking payment in
dollars and euros for its crude exports, the country’s vice
president said today as the pressure of international sanctions
increase on the Persian Gulf state.
“Iran has the liberty to use the currency it favors,”
Vice President Mohammad Reza Rahimi told reporters at an event
at the Economy Ministry in Tehran. “We will do whatever is in
the interest of the country.”
Iran, like most oil exporters, prices its crude in dollars.
Financial sanctions imposed by the U.S. and the United Nations
make it difficult for Iran to collect dollars from foreign banks
for the sale of its oil.
“All of the crude exported is still priced in dollars yet
Iran is now forced into accepting different currencies,” PFC
Energy Dubai-based analyst Thaddeus Malesa said in a phone
interview today.
International Oil Daily reported on July 15 that Iran is
considering switching to the United Arab Emirates’ dirham from
the euro for oil sales to Europe, citing two unidentified
industry executives.
“We have different contracts with different countries, but
what is important is to move away from euro and dollar,” Rahimi
said when asked about reports that Iran wants to sell some of
its oil for dirhams. The U.A.E. is an ally of the U.S., and it
pegs its currency to the dollar.
The U.S. Treasury Department has threatened international
banks that are accepting dollars transactions with Iran from
being banned from the U.S. banking system. The measure has been
“successful” and is pushing Iran to turn to smaller, more
local banks and to diversify its accounts, Malesa said.
For Iran having accounts in dollars is increasingly
problematic and the same will apply with euros, he added.
The UN Security Council passed a fourth round of sanctions
against Iran on June 9 that include restrictions on financial
transactions, on concerns that Iran may be developing a capacity
to build nuclear weapons. The Iranian government insists it is
developing nuclear energy for civilian use.
Barack Obama expanded the July 1 sanctions by the U.S.
targeting Iranian banking access with the European Union
governments saying on June 17 the EU would also impose
additional curbs on Iran’s financial transactions.
Though the punitive measures are unlikely to disrupt Iran’s
crude exporting, it is “no doubt making Iran’s life more
difficult,” Malesa said.
Iran produced an estimated 3.74 million barrels of oil a
day in June, according to Bloomberg data. Saudi Arabia is the
largest producer in the Organization of Petroleum Exporting
Countries.
To contact the reporter on this story:
Ladane Nasseri in Tehran at
lnasseri@bloomberg.net
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