Iran: Russia Set to Start Oil-for-Goods Deal

Iranian Oil Minister Bijan Zanganeh told reporters in Vienna that Russia may start importing crude oil from Iran next week as part of an oil-for-goods agreement.

“We hope that next week Russia will take (its first imports),” Zanganeh said after attending a meeting of OPEC. “Much of this will be for cash and we will be using this money to buy commodities from the Russians.” (Bloomberg, 6 June)

Zanganeh said he discussed the deal with his Russian counterpart Alexander Noval in Vienna on 3 June. Zanganeh added, however, that Russia plans to buy “much lower than 500,000 bpd,” a figure that had originally been agreed two in the now-famous oil-for-goods deal. He did not disclose the amounts of first and subsequent deliveries to Russia.

Iranian oil exports dropped 50 percent since oil and banking sanctions were imposed in 2011. The agreement with Russia was to compensate for lost exports.

Russia Unable to Sell Iran Oil

Questioning Viability of Oil-for-Goods Barter Agreement

Iran said today that Russia has not been able to sell any of its crude oil cargoes. The announcement questions the viability of an oil-for-goods barter agreement that has been signed between Iran and Russia.

“The problem with the barter agreement with Russia is the fact that it has not been able to sell any Iranian oil cargoes,” said Mohsen Qamsari, the deputy director of National Iranian Oil Company (NIOC). “Russia should be first able to market Iran’s oil so that Iran could provide it with [additional] crude.” (Press TV, 9 May)

Under the barter deal, Russia was to purchase 500,000 barrels of crude oil per day from Iran in exchange for millions of tons of Russian goods a year.

Iran: No Oil Swap Deal in Place with Russia

Oil Glut, Plummeting Prices Probably Killed the Deal

 

Iranian Oil Minister Bijan Zanganeh said today there is no oil-for-goods deal currently in place between Iran and Russia. (UPI, 11 December)

In January, the two countries announced they were negotiating an oil-for-goods swap worth $1.5 billion a month, allowing Iran to raise its oil exports substantially. The deal, exporting 500,000 barrels a day of crude to Russia in exchange for Russian equipment and goods, could have violated the exiting oil sanctions against Iran.

As late as November, however, the Kremlin was saying that it planned to sign contracts to deliver grain and possibly industrial products to the Iranians in exchange for oil. The recent oil glut and plummeting of global oil prices would probably have made the deal unworkable, as re-selling that much of Iranian crude in this market would not have been easy.