Private companies to start exporting Iran's oil

Iran Materials 9 May 2012 12:19 (UTC +04:00)

Azerbaijan, Baku, May 9/Trend M. Moezzi

Iran's oil ministry has issued a permit for private companies to export oil.

The private sector can now export 20 per cent, about 400,000 barrels of Iran's daily crude production, the Iranian Students' News Agency (ISNA) reports.

"Companies have to meet the oil ministry's conditions to participate. They must have a contract to either sell oil or provide fuel for a foreign refinery and are prohibited from negotiating with the National Iranian Oil Company's (NIOC) clients, "said Hasan Khosrojerdi, head of the Iranian Oil, Gas & Petrochemical Products Exporters' Association (OPEX).

One other condition imposed by the NIOC is that oil cannot be sold to French and British refiners including France's Total and Britain's Shell.

The private sector will sell Iran's oil at daily prices and at free exchange rates although details haven't been worked out by the Central Bank of Iran (CBI) yet.

"Selling Iran's oil privately in one way to circumvent the sanctions imposed against the CBI," said Mr Khosrojerdi

Iran is in a standoff with the West over its nuclear programme. Iran contends its programme is civilian and peaceful while the U.S. and its allies insist it is military in nature. The U.S. has led sanctions against Iran's oil industry and its central bank.

The European Union is scheduled to impose a full embargo on Iranian oil imports starting July 1.