Iran uses its stock exchange to keep its oil trade alive. Shows that it is not helpless, despite stringent U.S. sanctions.
The National Iranian Oil Company Stated that Iran has brought its stock exchange to life again, after nearly 4 years with the purpose of selling over a million barrels of crude oil. While this measure is not going to have much impact once the sanctions come into play, it is a strong message, which experts worldwide have recognized, which shows that Iran is not completely helpless against the actions of the United States.
The aim for this action is to get private investors into buying Iran’s stocks of crude oil through shares and thus indirectly selling to foreign traders. While a number of industry experts expect that foreign firms will still face penalties from the US for trading with Iranian businesses, as a breach of sanctions, most there are still good prospects that Iran’s action will be far from ineffective.
The stock exchange trade has every possibility of being extensively utilized by illegal traders, and not just by legal local firms in Iran. This is especially true since the National Iranian Oil Company nor can the government of Iran directly involve themselves in negotiating with illegal traders. This means that private middle men get the scope to arrange to meet buyers and arrange for logistics infrastructure that will not be visible to international monitoring systems.
The National Iranian Oil Company stated that the price of the oil barrels that are to be sold through the stock exchange would largely depend up on rates the company has received so far through international oil delivery. In addition the NIOC also stated that 20 percent of the payment could be given in rials while the rest must mandatorily be paid in foreign currency.
The oil barrels that are to be sold through the stock exchange equals Iranian export of oil for approximately that of a single day. It is not an amount that is expected to cause any significant impact. A number of industry experts expect that this is a move by the Iranian government that is aimed towards boosting the morale of the country’s population.
On the other hand if such efforts are made on the regular, the oil sales of Iran could be boosted significantly, even if it is only half the amount being sold on a daily basis. Iran is expected to do everything to make the purchase of oil as easy as possible for the biggest oil consumers in the market.