Press TV reports: Iran abandons dollar in oil deals
Iran has completely stopped carrying out its oil deals in dollar following the OPEC proposal to trade crude in non-dollar currencies.
“The dollar is no longer a reliable currency, considering its devaluation and the loss suffered by oil exporters,” said Iranian Oil Minister Gholam-Hossein Nozari.
“Iran proposed in the last OPEC (Organization of Petroleum Exporting Countries) summit that member states use a reliable currency in their oil transactions to prevent further losses,” he said, adding that the organization will come to a decision on the issue in the Vienna meeting on February 2.
Meanwhile, the organization decided to keep oil output unchanged at the Abu Dhabi summit on December 5, arguing that there was enough oil in the market to meet winter fuel demand.
AFP reports:
Major crude producer Iran has completely stopped carrying out its oil transactions in dollars, Oil Minister Gholam Hossein Nozari said on Saturday, labelling the greenback an “unreliable” currency.
“At the moment, selling oil in dollars has been completely halted, in line with the policy of selling crude in non-dollar currencies,” Nozari was quoted as saying by the ISNA news agency.
“The dollar is an unreliable currency, considering its devaluation and the oil exporters’ losses,” he added.
The world’s fourth largest oil exporter, Iran has massively reduced its dependence on the dollar over the past year in the face of US pressures on its financial system and the fall in the dollar.
Nozari did not specify in which currencies Iran was now being paid. In the past, officials have said most oil income was in euros, with a significant percentage in yen.
Japan, which purchases 20 percent of Iran’s crude oil, has recently agreed to pay for the crude oil in yen, officials have said. The UAE dirham has also been mooted as a possible payment currency.
Iran has in the past months been whittling down the proportion of dollars in its oil revenue income. Officials in October said that dollars accounted for only 15 percent of payments and predicted the amount would fall to zero.
However, the oil income is still being booked in dollars.
The United States has in recent months successfully encouraged major European and Asian banks to cut their dealings with Iran in a bid to make the Islamic republic give way on its controversial nuclear programme.
Washington has also blacklisted major Iranian banks for alleged support of terrorism and seeking nuclear weapons, charges denied by Tehran.
Iran has also reduced its dollar assets held in foreign banks and urged OPEC to take collective action to price oil in other currencies such as the euro, instead of the US currency which is used across the world at present.
The fall of the dollar, which has weakened considerably against the euro and other currencies in the past 12 months, has affected the revenues of OPEC members because most of them price and sell their oil exports in the US currency.
This will be celebrated by most Americans, American leftists, American conservatives, presidential candidates from both parties. Everyone now a days seems to favor a “WEAK” dollar. In the recent presidential debates (both parties . . . they agree on the big issues) every candidate was competing with the other in saying how they wanted to debase and devalue the dollar more.
Palast and all the leftist “economists” favor a “WEAK” currency to the person.
Will Chavez switch to euros? . . . only if he thinks the US dollar will strengthen. To explain Venezuela assumes a certain oil price. If oil prices are higher than expected (recently), then Chavez gets to spend the “excess” “unexpected” revenue however he pleases. Chavez is all about increasing his “excess” “unexpected” revenue. Therefore he will keep the dollar if he thinks the dollar will be devalued further (since a devalued and debased dollar will result in a higher dollar price of oil and therefore more excess revenue for Chavez to spend at his discretion.)
Off topic: The vast majority of Chavez’ friends (including on wall street and corporate America) are fair weather. I suspect that most will all dump him the moment oil prices drop. Chavez will be thrown out of power the next time oil prices drop. He knows this. He is praying that oil prices stay elevated.
For documentation on how America consistently backed Chavez between 1998 and 2002 (including during the coup that tried to overthrow him) see:
http://www.mcclatchydc.com/homepage/story/22814.html
Vineyard, do you think America backed Chavez because of his close ties with wall street and corporate America (I have seen corporate executives boast about their close ties with Chavez before . . . if only to boost the share prices of their companies)?
Is America’s support for Chavez (who has autocratic leanings) part of the reason you allege America is leaning towards a type of creeping fascism?
I would note that Chavez was able to buy restricted military equipment (that many other countries including—rightly–Pakistan were denied) for quite a few years after 2002 (including F16 spare parts.). Many hoped that America’s low-key quiet support for Chavez’ reelection might pay dividends.
Vineyard, I still don’t understand your global mindset or how you interpret events around the world
Are you like me against all trade/investment sanctions against poor countries (trade barriers)? This, I believe, is one of the most important global issues.