Iran Faces No Hassle in Oil Payments

EghtesadOnline: Iran is being paid for its crude oil exports without any problem, the deputy oil minister for international affairs said, adding that the country's crude revenues verged on $50 billion in the last fiscal year.

News ID: ۷۸۱۶۳۱

03 February 2018

“We sold €40 billion ($49.8 billion) worth of oil in the last fiscal year [ended March 2017] and received all its dues,” Amirhossein Zamaninia was also quoted as saying by ILNA on Wednesday.

According to Financial Tribune, Zamaninia added, “We have no problem in payments for exports to European and Asian customers, including India. There have been some issues with China and South Korea who pay in their own currencies and Iran has to pay an additional charge to convert the payments to euro.”

Iran made $95 billion and $69 billion from crude exports in 2011 and 2012 respectively, according to the US Energy Information Association, before sanctions took a toll on its crude market share.

Turkey, Italy, Britain, Hungary and the Netherlands are among chief European clients of Iranian crude.

Until two years ago, Iran was shut out of the European energy market and its oil trade was limited to a handful of Asian buyers that took in just 1 million barrels a day under temporary waivers.

But the lifting of sanctions in January 2016 helped Iran resume oil sales to major customers in Europe.

Crude prices crashed from over $100 a barrel in mid-2014 to less than $30 a barrel in early 2016, prompting OPEC and non-OPEC producers to form an alliance to cut back on output.

Oil prices have been supported by the extension of a supply cut pact between OPEC and some non-OPEC producers from March up to the end of 2018.

--- Oil Production

According to Zamaninia, Iran’s daily export of oil and condensate, a type of ultra light crude, stands at 2.6 million barrels.

Oil Minister Bijan Namdar Zanganeh said last week talks are underway with international companies over a string of oil projects that could lift oil output capacity by 1.7 million bpd, Shana reported.

Iran is pumping around 3.8 million bpd of crude oil and condensate. It can raise output capacity to 5.5 million bpd, or about 1 million bpd above the current production level of Iraq, the second largest OPEC producer ahead of Iran.

The initial target is to lift crude production to 4.5 million bpd.

"Iran's upstream oil projects need $130 billion in investment," the minister said, adding that his ministry aims to pool resources from foreign investors and the National Development Fund of Iran.