Russia: Iran oil-for-goods deal still in effect
An oil-for-assets barter deal between Iran and Russia is still in force but low oil prices are preventing them from implementing the arrangement, a Russian official says.
"Oil has cheapened from the time the deal was signed; this has become an objective obstacle to sell Iranian oil to any market. The program works, but so far with no results," Russian trade envoy to Iran Andrei Lugansky said Tuesday.
The two countries have agreed on oil-for-goods swap worth $1.5 billion a month under which Russia would buy up to 500,000 barrels a day of Iranian oil in exchange for Russian equipment and goods.
Oil prices have slumped from $100 to under $50 per barrel since summer 2014, primarily as a result of global oversupply.
There are few details about the barter arrangement except for Russian Energy Minister Alexander Novak saying that the deal did not envisage any oil supplies to Russia, or Russia shipping Iranian oil cargoes on to other markets.
Under the deal, Iran is about to get cash and Russian goods and services for the oil which is sold, Minister of Petroleum Bijan Zangeneh has said.
Russia and Iran also plan oil and gas swap as part of their new push to step up trade, Iran’s Deputy Petroleum Minister Amir Hossein Zamaninia said earlier this month.
Under the arrangement, Iran would take delivery of Russian oil, gas and their derivatives in the Caspian Sea for use in northern provinces and deliver the same amount of the products to Russia’s customers in the Persian Gulf.
The plan follows a recent visit to Tehran by Russia’s Energy Minister Alexander Novak at the head of a large trade delegation to expand relations.
After visiting Tehran, Novak said Russia’s state-owned energy giant Zarubezhneft would take up several projects worth a total of $6 billion in Iran’s oil industry.
On Tuesday, Russian trade envoy to Iran Lugansky said Russian trucks are "in great demand" in Iran, adding the country required orders totaling an estimated $20 billion.
"Examples of Russian trucks have been already delivered to Iran. These trucks are sold not only in Iran but worldwide. Our trucks are in great demand in Iran," he told the RIA Novosti news agency.
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