June 9, 2015
Translated by Kristina Rus
Moscow – Tehran: the long-awaited oil breakthrough
1. “Russia will begin oil imports from Iran next week as part of the deal “oil in exchange for goods.” – http://tass.ru/ekonomika/2024622
2. “According to the publication, the purpose of the transaction for Iran is to “stake out their place in the market, and make Russia a partner.” According to the source, the Iranian oil trader will be one of the enterprises controlled by the Ministry of Energy. Moscow plans to buy about 300,000 barrels of oil a day and sell it in the markets of the Asia-Pacific region, and settlement of transactions will be conducted at one of the local banks.” – http://www.forbes.ru/news/290869-smi-uznali-detali-neftyanoi-sdelki-rossii-i-irana
3. On June 8, the Russian Minister of Energy, Alexander Novak said that in the framework of cooperation between Russia and Iran, Tehran has decided to sell its oil, and buy Russian goods for the proceeds. He explained that Iranian oil will not be sold in Russia, because Russia is “a producing country”, – reported RIA Novosti. http://ria.ru/economy/20150608/1068855705.html
I understand that our liberal media will try to write that the deal will not bring Russia any benefits or even will bring losses, but this is expected, predictable and boring.
There are several obvious benefits for Russia:
1. We get control over where part of Iranian oil is sold. If it will be profitable for us – will sell it in Asia (less will go to Europe) or vice versa. 300,000 barrels a day is a little more than 10% of Iranian production (according to Bloomberg – http://www.bloomberg.com/news/articles/2015-03-19/iran-can-add-million-barrels-of-oil-fast-but-needs-help-for-more. In the future the volume can be increased. Control over oil is a prime geopolitical lever. Again: Iran gives us 10% of its production in exchange for Russian goods, and we decide where, how, to whom and for what currency to sell this oil from Iranian ports.
2. The increase in Russian exports and market share in Iran.
3. No dollars in the settlements.
We can congratulate the Russian diplomats. Well played and good timing.
P.S. One of the comments:
“In fact this is a conversion of Russian goods into a super-liquid form. A definite plus.”