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Europe promised to buy 1 mln barrels of Iran's oil through INSTEX - expert

Oil&Gas Materials 26 March 2019 09:46 (UTC +04:00)

Tehran, Iran, March 26

Trend:

The launch of a financial channel (INSTEX) by Europe to facilitate Iran's oil exports would be the best mechanism in the current situation that would make the industry stronger, an expert believes.

INSTEX (Instrument in Support of Trade Exchanges) is a mechanism, created to facilitate non-dollar trade with Iran, allowing European companies to trade with the Islamic Republic without being hit by the sanctions.

On Jan. 31, three European countries – France, Germany and the UK (shortened as E3) – officially announced the creation of the Instrument in Support of Trade Exchanges (INSTEX), a special purpose vehicle, to allow them bypass US sanctions on trade with Iran. INSTEX facilitates non-dollar trade with Iran, allowing European companies to trade with the Islamic Republic without being hit by the sanctions.

"Europe's financial mechanism creates transparency and is the best help to sell oil in the current situation, it would be a trusted financial network to depend on,", said an energy expert Ali Asghar Zargar, Trend reports citing ILNA.

Referring to country's oil plans in the new Iranian year (started March21, 2019) he said that there are no issues with oil production in Iran.

"We have the daily production capacity of 4.5 million barrels, but there are problems with exports, so considering the sanctions, new export markets should be defined," he said.

"Europe has promised to purchase 1 million barrels of Iran's oil through the financial mechanism, so if it works out, we can count on exporting some 1.5 million barrels," said Zargar.

He also hinted at attracting other customers through diplomacy, discounts and low prices.

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