Vice President of the Chamber of Commerce: Iran's Oil Sales to Europe Will Be Bartered

The Vice President of the Iran Chamber of Commerce announced that, based on the proposals from Europe to the Islamic Republic, the purchase of Iranian oil by Europe will be conducted through barter (exchange for goods). According to the Iran Chamber of Commerce website, Pedram Soltani stated on Tuesday, July 16, that "it seems Europe wants these exchanges to be conducted through barter. That is, instead of directly paying for oil, it will be accounted for in a way that Iran's purchases from Europe will be conducted through that." Previously, Eshaq Jahangiri, the First Vice President of Iran, had identified "barter" or the exchange of oil for essential goods as one of the strategies to counter US sanctions; a measure that was also implemented during Mahmoud Ahmadinejad's presidency but later reports indicated that Iran's payments were not received. For instance, Yahya Al-Ishaq, head of the Tehran Chamber of Commerce, stated in 2014 that Iran had "about 100 billion dollars of frozen currency" in countries like China, India, and Japan, but "cannot quickly utilize them." Meanwhile, Iran's Minister of Oil stated on Saturday, July 7, that Iranian Foreign Ministry officials were "not very satisfied" with the details of the proposed European package. The US aims to reduce Iranian oil exports to zero, but Steven Mnuchin, the US Treasury Secretary, has said that if buyers of Iranian oil "cannot do this overnight, we will make exceptions." The statements of the Vice President of the Iran Chamber of Commerce come at a time when officials from the Islamic Republic and European officials have not disclosed the details of the European proposal to Iran. On Tuesday, Behrouz Kamalvandi, spokesman for the Atomic Energy Organization of Iran, stated that this package considers some of Tehran's demands, such as financial exchanges, transportation, and oil sales, but requires further dialogue. Meanwhile, the Wall Street Journal reported, citing several European officials, that the European Union is seeking to create or activate old accounts of the Central Bank of Iran in the central banks of member states to preserve the JCPOA. European officials also told the newspaper that a prerequisite for this plan is the implementation of "FATF" standards or anti-money laundering regulations by Iran. This is while the status of four bills related to the implementation of the Financial Action Task Force (FATF) regulations remains unclear and has become more complicated due to the opposition of Ayatollah Khamenei, the leader of the Islamic Republic. The Vice President of the Iran Chamber of Commerce also stated on Tuesday that Europe intends to provide a "support umbrella" for small and medium-sized enterprises "to work with Iran." He announced that the European Union plans to allocate 80 billion dollars to facilitate trade relations between small and medium-sized companies in Iran and Europe. Mr. Soltani also mentioned that countering US sanctions regarding maritime transport and its insurance coverage is "very difficult" and that "if Europe can use its own state institutions in the insurance sector, that would be very good." He also noted that most maritime insurance institutions "are either American or have American shareholders." The European Union is trying to protect European companies from US sanctions by activating "blocking regulations." The "blocking regulations" prevent EU companies from complying with US sanctions and do not recognize any court ruling for the enforcement of US penalties. These regulations, which were established in the 1990s to counter US sanctions against Cuba, have never been officially implemented. Even if the blocking regulations are enforced, companies that interact with the US may refrain from cooperating with Iran for fear of losing the US market. European Union leaders have expressed hope that medium and small European companies will be able to cooperate with Iran.