Data from IRENEX shows more than 295.82 trillion rials ($1.2 billion) worth of commodities were traded via the energy exchange during the period, Securities and Exchange News Agency (SENA) reported.
The figure indicates strong promise with a whopping 540% growth compared to the corresponding period last year, the highest in the history of the relatively new market.
In a talk with SENA, Hossein Nowruzi Zadeh, the Pasargad Brokerage deputy head for IRENEX trade, said the highest trade value was recorded in the last calendar month (June 20-July 21) with 112.14 trillion rials ($486 million).
Citing IRENEX officials, Nowruzi Zadeh pointed to the increasing diversity of goods offered at IRENEX, saying that so far 155 commodities and 46 power plants have been listed in the energy bourse.
Increase in foreign exchange rates in Iran is one the main reasons driving trade at IRENEX, he said.
Following a supply crunch in the forex market, rates started rising exponentially from June. In trends never seen in the domestic forex market, the dollar sold for 260,000 rials that month from 160,000 rials in March. The greenback is now hovering around 230,000 rials as shortages remain conspicuous.
Nowruzi Zadeh pointed to efforts by IRENEX officials to ease trading conditions as another key driver of market growth. “Easing the bureaucracy and scrapping cumbersome rules in the process of listing new products, plus issuing trading codes for foreign investors indeed had a positive effect on the energy exchange.”
Regarding challenges traders face at the exchange, he pointed to restrictions in money transfer, which has made it difficult for foreign buyers to trade, especially in the international ring.
Crude Offer, a Failure
Nowruzi Zadeh acknowledged that the government’s move to sell crude oil via IRENEX was futile due mainly to US sanctions imposed on Iran’s oil export.
Following withdrawal of the United States in May 2018 from the Iran nuclear deal, IRENEX was given a mandate to sell crude oil in the autumn of that year. Save for a few initial deals, the measure failed to attract buyers.
The National Iranian Oil Company offered heavy crude at regular intervals in the last fiscal year (March 2019-20) but to no avail.
Unlike crude oil, trade in other oil derivatives such as gasoline and diesel has been effective.
“The sale of petroleum products both in the domestic and international rings has been well-received, especially by those from neighboring companies,” Nowruzi Zadeh said.
The government has been able to sell surplus gasoline and diesel on the energy market since the initiative started in summer 2019.
Market data compiled by Tehran Chamber of Commerce, Industries, Mines and Agriculture, shows that the government generated $105 million by selling gasoline and oil gas during the month through July 16.
Fuel trade at IRENEX grew after it was officially announced that gasoline and oil gas production had far surpassed domestic demand and the nation reached self-sufficiency in producing the key fuels that apparently have buyers overseas, particularly in the neighboring countries.