Iran's ex-official proposes to set up pre-sale of oil bonds at Stock Exchange
Tehran, Iran, March 12
The pre-sale of Iran's oil in the form of bonds at the country's Stock Exchange can be an opportunity to develop the country's oil industry.
The former head of Iran's petroleum contracts committee Mehdi Hosseini discussed the issue with Trend.
"There have been some, who have thought of this. We are in a situation, where lots of money is required to develop the oil industry, specially regarding exploration and production sectors," he told Trend.
"Due to lack of foreign companies' presence, domestic companies do not have sufficient financial capacity, therefore money should be gathered. How to do it is the main question," Hosseini said.
"It can be achieve by selling bonds, and there are other ways as well, but they all have their own specific problems. My suggestion is to launch the pre-sale of oil bonds within a three-year timeline," he said.
"The bonds sale can be in rials or foreign currency, so that it could attract people's foreign currency," he said. "For example, the base price guarantee is $50 per oil barrel, within the next three years, the money can be returned, but the price shouldn't go lower this limit, even if the oil price is $40."
Hosseini went on to say that people have more trust in oil rather than banks or financial institutes.
"The oil bond sales can change the oil market, since the sale isn't about a physical sale of oil," he said. "It means that after three years, if a buyer has demanded his oil or would not want to sell the bond, we would return his money. If at that time, the oil price is at $70, the investor wins $20 in profits."