Barter deal signed between Russia and Iran

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Barter deal signed between Russia and Iran

Russia and Iran signed a barter agreement, under which Iran will sell crude oil to Russia in exchange for products.

This agreement was initially discussed in April 2014 when Iran was under Western sanctions over its nuclear program, where they have been restricted to trade in US dollars.
Russian traders were to participate in the selling of Iranian oil and in exchange Iran receiving in return essential goods and Russian technology.

“The deal has been concluded. We are just waiting for the implementation from the Russian side. We have no difficulties; we signed the contract, everything is coordinated between the parties. We are waiting for Russian oil companies to send tankers, “said Iran’s Oil Minister Bijan Zanganeh.

Russia and Iran have been also discussed about energy, electricity, nuclear energy, gas and oil, as well as cooperation in the field of railways, industry, and agriculture.

The sanctions placed over Iran were lifted in 2016; Russian Energy Minister Aleksandr Novak said that the deal as discussed is no longer necessary.

“US primary sanctions apply to US financial institutions and companies, including their non-US branches (but not their subsidiaries). Moreover, with very limited exceptions, businesses and individuals related to the US continue to be generally prohibited from dealing with Iran, including with the government. US dollar clearing restrictions have not been lifted and pose a significant challenge for non-US banks that may do business with Iran, but may not be paid in US dollars.” the IMF said.

In February, Russia’s state trading enterprise Promsirieimport has been authorized by the government to carry through the purchase of Iran’s oil through the oil-for-goods program under study by both countries.

The Russian Energy Minister Aleksandr Novak announced in March 2017 the plan was back on the table with Russia buying 100,000 barrels per day from Iran and selling the country $45 billion worth of goods and technology.