Amirhossein Tebianian, the NIOC representative in charge of offering petroleum products on IRENEX says the new conditions are related to the minimum purchasing volume and adjusting the pricing mechanism.
According to the NIOC website, as per the new instructions issued by the Oil Ministry, the minimum purchase order will be reduced from the previous 35,000 barrels to 1,000 barrels for land delivery.
In the previous procedures, 1 million barrels of crude oil was offered in cargos of 35,000 barrels each and buyers were required to purchase at least one cargo, Financial Tribune reported.
However, the minimum purchase for sea delivery remains unchanged.
In the next oil sale on Tuesday two million barrels of light crude oil will be on offer by the NIOC at a base price of $67.28 per barrel.
Those interested are required to pay 6% of the order value in rials or foreign currency two hours before the beginning of trading time at 02:30 pm local time. Moreover, the payment clearance period has been extended from 60 to 90 days.
As for pricing procedures, the NIOC notice says the base price of a barrel of crude is in line with the average Brent quotations during 10 international business days before the date of the offer.
Buyers can receive the cargo either at Kharg Island terminal off the Persian Gulf for sea delivery or at Tabriz Refinery if they want a land delivery.
Payments can be made in rials or foreign currency and the exchange rate is based on open market rates reported by SANA website (a system operating under the supervision of central bank that records average exchange rates from across exchange bureaux).
Offering crude oil on the stock market is part of government efforts to involve the private sector and international companies in the oil industry, which has long been under government control.
Nonetheless, the move has not produced the desired results as during the previous rounds the NIOC hardly managed to sell 1.1 million barrels of crude via IRENEX.
Role of the private sector in oil sale has gained traction, particularly after the new US sanctions, which among other things, has hit the oil industry hard, aiming to paralyze the economy.
As part of the current fiscal budget, parliament obliged the Oil Ministry to offer on a monthly basis 2 million barrels of light crude on IRENEX.
Highlight: as per the new instructions issued by the Oil Ministry, the minimum purchase order will be reduced from the previous 35,000 barrels to 1,000 barrels for land delivery
Caption: Buyers can receive the cargo either at Kharg Island terminal off the Persian Gulf for sea delivery or at Tabriz Refinery if they want a land delivery.