ZCZC
BCN-05
IRAN-OIL-MARKET-SANCTION
Iran sells oil on exchange in bid to counter sanctions
TEHRAN, Oct 29, 2018 (BSS/AFP) – Iran sold oil to private buyers through
its energy exchange for the first time on Sunday, as part of its efforts to
counter the imminent return of US sanctions.
Only 280,000 barrels were sold out of one million offered, and went for
$74.85 per barrel, more than $4 below the initial asking price.
The identity of the buyer remained a secret, with the conservative Fars
news agency saying only that a conglomerate of private firms had made the
purchase through three brokerages.
The US is set to reimpose sanctions on Iran’s oil industry on November 5,
following President Donald Trump’s decision to walk out of the 2015 nuclear
deal in May.
The plan to sell oil to private companies on the energy exchange was
floated back in July by first vice-president Eshaq Jahangiri with the aim of
“defeating America’s efforts … to stop Iran’s oil exports.”
The government hopes selling to private buyers, rather than direct to
foreign clients, will make it harder for the US to monitor and stop its
sales.
“With the imminent return of a new wave of sanctions, the government is
determined to utilise the manoeuvering ability of the private sector to sell
Iran’s oil and find new markets,” Hamidreza Salehi, director of Iran’s energy
exports federation, told semi-official news agency ILNA.
Some estimates show Iran’s crude exports have already dropped by a third
since May when it was selling around 2.5 million barrels per day.
The government currently intends to offer oil on the energy exchange once
a week, according to Fars.
Its initial base price on Sunday was $79.16, but it received limited bids
as much as $16 lower as trading began, the exchange’s website showed.
The final buyer only emerged after the base price was dropped to $74.85 in
the closing hours.
The head of Iran’s securities and exchange organisation, Shapour
Mohammadi, promised on Friday that the identity of the buyer would not be
revealed.
BSS/AFP/HR/1010