Iran's Supreme Economic Coordination Council: The Private Sector Can Export Oil

On Tuesday, May 16, Iran's Supreme Economic Coordination Council approved a plan allowing the government to sell oil to the private sector. This means that the private sector can purchase and export petroleum products from the government. Previously, the First Vice President of Iran had announced the government's decision to transfer oil exports to the private sector to counter U.S. sanctions. According to the IRNA news agency, the Supreme Economic Coordination Council approved a plan for the sale of crude oil in the 'export ring of the domestic energy exchange in foreign currency' during its meeting on September 17. Under this plan, the Ministry of Oil can sell crude oil and petroleum products at 'competitive prices' in the domestic stock exchange using 'the capacity of the private sector for exports.' The Supreme Economic Coordination Council of Iran was formed after the U.S. withdrawal from the JCPOA and the re-imposition of sanctions. The heads of the three branches of government and several government officials are members of this council. Before the approval of this plan, the First Vice President of Iran had informed about the government's decision to transfer oil exports to the private sector. Eshaq Jahangiri stated on September 1: 'The primary goal of the U.S. is to prevent the sale of Iranian oil, and in this way, the private sector can transparently purchase and export oil from the stock exchange.' Pedram Soltani, Vice President of the Iran Chamber of Commerce, Industries, Mines, and Agriculture, reacted on Twitter, stating that 'the real private sector does not have the capacity to export crude oil.' He also expressed concern about the sanctioning of private companies and traders exporting Iranian oil. Details of the government's plan for offering petroleum products in the energy exchange have not been disclosed. Meanwhile, some analysts have expressed concerns about corruption in this area and the repetition of events that occurred during the previous administration. However, the Donya-e-Eqtesad newspaper reported that the petroleum products sector in the energy exchange reduces the risk of corruption, referencing the sale of oil by Babak Zanjani. The oil exchange was established in Iran in 1998, and since 2007, petrochemical products have been offered in the Iranian commodity exchange. In 2011, heavy crude oil and fuel oil were also offered in the commodity exchange, but customers reported that the prices offered by the Ministry of Oil were high. The National Iranian Oil Company stated that these products were offered at the same price they sell to their customers. The re-imposition of U.S. sanctions began on August 6, and the U.S. has announced that in the next phase of sanctions, starting on November 4, it will attempt to reduce Iranian oil sales to zero. According to some analysts, sanctions on oil sales and banking sanctions will be the most significant sanctions against Iran, a point that some officials of the Islamic Republic have also acknowledged.