Iran to maximise oil income in non-US currency

Iran to maximise oil income in non-US currency

16-07-07 Iran wants to maximise oil export revenue in non-dollar currencies while the dollar stays weak, a top Iranian oil official told. Hojjatollah Ghanimifard, international affairs director of the state-owned National Iranian Oil Company (NIOC), also confirmed that Tehran has asked customers in Japan to pay for their crude oil in yen instead of dollars.
“As long as the dollar is weak, the best decision is for us to move away from it — and we will want as much revenue as possible in non-dollar currencies,” Ghanimifard said.

For the past 18 months — as the United States leads efforts to isolate Tehran for its nuclear programme — the world’s fourth biggest oil exporter has done just that.
“This is not a political gesture,” said the NIOC official. “We’re losing our purchasing power if we stick with the dollar.”

NIOC is now asking customers in Japan — all of whom previously bought Iranian oil in dollars — to open letters of credit in yen, the official said. The state oil company will also issue its invoices in the Japanese currency.
After Japan makes the switch, more than 70 % of the Islamic Republic’s oil revenue will be in currencies other than the dollar, said Ghanimifard.

Iran, OPEC’s second biggest producer, exports around 2.3 mm bpd of crude, with up to 65 % of that volume moving into Asia.
“Our Japanese clients will understand that what we’ve done is for the mutual interest of both sides,” said Ghanimifard. “We wanted to avoid any complications and make the payment process easier for them.” He said it would take about a month to calculate how much of Iran’s oil sales to Japan — more than 300,000 bpd — were being paid for in yen. Iran informally asked its Japanese buyers to switch to non-dollar payment several times since late last year.

NIOC’s recent move makes the policy official — at least until the dollar strengthens, a trend that may take a while to emerge said Ghanimifard.
“The weak dollar looks like it will stay for months to come,” he said.

Source: / Persian Journal


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