Tehran, Iran, Oct.30
Trend:
One way to reduce the impact of sanctions is investing in oil coin infrastructure and the sales of oil for crypto currencies, Abdol Samad Rahmati, an oil sector analyst, told Trend.
"It has become popular among the public that the Iran's oil sanctions will begin on November 4, while the sanctions have started since the US withdrawal from Iran deal, and November 4 is a point to assess Iran's oil sales and reviewing its buyers for paying the fine,” he said.
“Iran has planned appropriate measures to deal with the effects of its oil export reduction. For example, creating an oil stock exchange which, despite the challenges, began on Sunday October 28,” Rahmati said.
He went on to add that using the export-oriented organizations affiliated to the chambers of commerce, to sell oil is among Iran`s goals of how to deal with sanctions.
“It can be much better and more reliable than selling oil via people of any background,” said Rahmati.
“To reduce the impact of oil sanctions, Iran needs to create the “Oil Coin” infrastructure as an alternative way. It should be considered,” said Rahmati. "Investing in crypto currencies with the backing of oil and gas reserves is a new method, which, of course, requires the necessary infrastructure."
Referring to the use of storage oil into a bonded storage site at trusted ports, Rahmati said that Port of Rotterdam in Netherlands or port of Dalian in northeast China are both among the trusted locations for storage of Iran oil during the sanctions.
“Keeping oil in bonded storage gives the shipment owner the option to sell its oil by saving more time as well as a way to circumvent oil sanctions,” he said.
“Iran can also create attractive sale opportunities by providing appropriate discounts," he said.
Iran previously held oil in storage at Dalian during the last round of sanctions in 2014 that was later sold to buyers in South Korea and India.
"US sanctions are not as effective as they were expected to be, as the game and energy policies in the Middle East have changed,” he said. “Saudi Arabia and the UAE, which had already claimed to replace Iran's oil, are not capable of doing so, and as we can see, oil prices ranged from $70 to $80 a barrel, which is mainly due to the decline in Iran's oil production.”
On the other hand, Rahmati said the Saudi oil fields are in their second half life.
"To make Iran oil sanctions work better, the oil fields in the neutral zone between Saudi Arabia and Kuwait must produce oil, but they don't," he said.