TEHRAN, Iran, April 30, 2008
Iran Ends Oil Transactions In U.S. Dollars
OPEC's Second-Largest Producer Now Pegs Petroleum To Euros And Yen
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Iranian oil workers seen at Tehran's oil refinery, Iran, Nov. 17, 2007. Although OPEC has traditionally tied its price of oil to U.S. dollars, Iran has announced it has shifted sales of its oil to euros and yen. (AP Photo/Vahid Salemi)
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Iran has dramatically reduced dependence on the dollar over the past year in the face of increasing U.S. pressure on its financial system and the fall in the value of the American currency.
Oil is priced in U.S. dollars on the world market, and the currency's depreciation has concerned producers because it has contributed to rising crude prices and eroded the value of their dollar reserves.
"The dollar has totally been removed from Iran's oil transactions," Oil Ministry official Hojjatollah Ghanimifard told state-run television Wednesday. "We have agreed with all of our crude oil customers to do our transactions in non-dollar currencies."
Iranian President Mahmoud Ahmadinejad called the depreciating dollar a "worthless piece of paper" at a rare summit last year in Saudi Arabia attended by state leaders from the Organization of Petroleum Exporting Countries.
Iran put pressure on other OPEC countries at the meeting to price oil in a basket of currencies, but it has not been able to generate support from fellow members — many of whom, including Saudi Arabia, are staunch U.S. allies.
Iran has a tense relationship with the U.S., which has accused Tehran of using its nuclear program as a cover for weapons development and providing support to Shiite militants in Iraq that are killing American troops. Iran has denied the allegations.
Iranian oil officials have said previously that they were shifting oil sales out of the dollar into other currencies, but Ghanimifard indicated Wednesday that all of Iran's oil transactions were now conducted in either euros or yen.
"In Europe, Iran's oil is sold in euros, but both euros and yen are paid for Iranian crude in Asia," said Ghanimifard.
Iran's central bank has also been reducing its foreign reserves denominated in U.S. dollars, motivated by the falling value of the greenback and U.S. attempts to make it difficult for Iran to conduct dollar transactions.
U.S. banks are prohibited from conducting business directly with Iran, and many European banks have curbed their dealings with the country over the past year under pressure from Washington.
However, the U.S. has been wary of targeting Iran's oil industry directly, apparently worried that such a move could drive up crude prices that are already at record levels.
Iranian analysts say Tehran can withstand U.S. pressure as long as it can continue its oil and gas sales, which constitute most of the country's US$80 billion in exports.
© MMVIII The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.
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See all 103 CommentsYou are what is wrong with America. It''s
chauvinistic filth like what you have posted, that will lead to the Yooonited States downfall (won''t happen soon dammit!). I guess since Canada does business with Iran, (can you guess i''m Canadian?) it means that i''m an evil person, and thus a terrorist.
Sorry I have to go fix my igloo...it''s melting.
So maybe it would be better to change their currency for the present since the devaluation of the dollar is costing them.
Exactly how close is the Iranian petroleum system from collapse?
It is a metastable system with a heavy change bias to it. Internal collapse between 2012-19 is certain with current domestic market needs increasing and actual oil field production declining. And like many systems in decay the half-life is very important, because it is usually the inflection point for catastrophe: it is the point where a ship sliding to its side will suddenly capsize. It is the spell of bad weather for a year or two that can change lush cropland into dustbowls.
A point of no return.
If Iran announces that they will *not* be expecting to let any liquefied natural gas contracts of a substantial amount or will be stopping existing contracts, then a first and mighty indicator will be seen.
If Iran buys gasoline or any other finished petroleum goods en mass and announces refinery ''problems'' then that, too will be an indicator.
And in the next five years if Iran announces that it will be ''shutting off its oil to the world'', that means that it is no longer producing enough to sell and that it can barely cover internal needs.
So when you hear that ''Iran may threaten to cut off its exports'' it may not be due to ANY outside activity at all. They may have simply run out of oil to export.
And that will happen far before those two lines meet as when a system that is complex like oil refining begins to decay, it indicates that the most complex part of a very complex interlocking system is already going to hell. When that part of the system cannot be maintained properly, even at a LOSS, which is the case now, there is then a leading indicator that the less sophisticated parts of the system, like pipelines, pumping stations, well-head pumps, separation facilities and so on, are also being run inefficiently. The expertise needed to run those is in the same league, but more distributed as that needed to run the refineries. Those are now seen as not running up to capacity, either.
Much of that Canadian oil is actually Iranian oil after bein imported into Canada...........
Posted by Quetzal0666
Does Mexico also get it''s oil from Iran? I hear that Iran has to refine it''s oil which mean it has to go out of the country because the crude is too crude. So should we give a ***** if Iran wants to deal in other than U.S. greenbacks?
Man...a few more years of Republicans "running government like a Business", and they''ll be hanging "Foreclosed" signs across all of our customs booths at the nation''s ports and points of entry...
you dont have to like it,
thats the irony of this whole thing.
there are other countries and companies who buy from Iran, yet it ends up tight here.
Much of that Canadian oil is actually Iranian oil after bein imported into Canada...........
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Posted by Quetzal0666 at 10:29 AM : May 01, 2008
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So, are you saying that Canada does business with Iran? and since the US has declared Iran to be part of the axis of evil and therefore terrorists who are trying to nuke us.... are you saying we should bomb Canada for supporting terrorism?
Much of that Canadian oil is actually Iranian oil after bein imported into Canada...........
...one day Americans are going to awaken to this fact as well...but only after all the world wakes up to it and much of the animal kingdom.
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