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Page added on April 5, 2014
U.S. Warns on Potential Russia-Iran Oil Deal
Such a Move Could Trigger U.S. Sanctions, Official Says
The U.S. has no information to suggest that a reported Russian oil-for-goods deal is being completed, but has expressed concerns about a move that could lead to fresh U.S. sanctions, a senior official said late Friday.
“We do not have any information to suggest this deal has been culminated,” the senior U.S. official said in a teleconference ahead of the resumption of international talks on Iran’s nuclear program. “We have been very clear about our concerns with both parties regarding this or any similar deal.”
Reuters reported earlier this week that Iran and Russia were working to seal a $20 billion oil-for-goods deal in which Russia will receive oil in exchange for Russian goods and equipment.
“If such a deal were to happen, it appears it would be inconsistent with” last November’s interim nuclear deal “and could potentially trigger U.S. sanctions against the entity and individuals involved in any related transaction,” the official said.
Under last November’s agreement with Iran, the five permanent members of the Security Council, which include Russia, and Germany agreed to pause efforts to reduce Iran’s crude-oil sales, enabling Iran to export around one million barrels a day. U.S., European and international sanctions had led to a sharp fall in Iranian oil exports.
Last month, as tensions between Russia and the West flared up over Moscow’s annexation of Ukraine’s Crimea region, Russia’s chief negotiator at the talks warned that although his government doesn’t want to see the Ukraine conflict spill over into the Iran talks, “if we are forced to do this, we will go down the path of taking measures in response [to Western pressure].”
Iran’s oil exports have pushed above one million barrels a day over the last couple of months, but the senior U.S. official said Friday that Washington remains “comfortable that in fact they will meet the target that they have.”
The official described the experts’ nuclear talks this week as intense and said Russia hadn’t broken from its previous constructive, focused attitude to the talks.
Top negotiators from Iran and the five permanent members of the United Nations Security Council plus Germany will meet in Vienna on April 8-10 for the third round of negotiations on a final comprehensive nuclear agreement. The aim is to reach a deal by July 20 although the target date could be extended.
Iran says its nuclear program is for purely peaceful purposes but Western concerns that it is seeking nuclear weapons have led to tight energy, financial and commercial sanctions on the country in recent years.
The senior U.S. official said Iran and the six powers “are on pace with the work plan that we set out” to reach a deal.
The official said the real drafting work on a final deal will start in May.
14 Comments on "U.S. Warns on Potential Russia-Iran Oil Deal"
Plantagenet on Sat, 5th Apr 2014 1:06 am
It was just a few months ago that the US took sanctions off Iran—now they are threatening to put them back on.
Make up your mind already.
Makati1 on Sat, 5th Apr 2014 1:26 am
Basically, Russia is saying ‘FU’ to the Us and there is nothing the Us can do about it. Why? Because Putin has told the Us that it will freeze Western corporations operating in Russia.
Who are they? Siemens, GM, Ford, Intel, IKEA, Daimler, Exxon, GE, PepsiCo, BP, Carlsburg (beer), Coca-Cola, Royal Dutch Shell, Total (oil), and many more.
This is just forcing the abandonment of the dollar even faster.
rockman on Sat, 5th Apr 2014 2:05 am
So will Iran ship oil to Russia…an oil exporting country? Not necessarily. The Russians just buy the title to oil sitting at the Iranian terminal. Oil has an ownership title just like your car. Then the Russians can sell the title to THEIR OIL sitting in that Iranian tank farm to, let’s say, the French company Total. So Total contracts a tanker company to haul THEIR OIL from Iran to France. Or to England if Total decides to sell it to the Brits. Wire transfers of oil titles have been around for a long time. And guess what: Total can sell THEIR OIL to the Shell Norco refinery in Louisiana. After all, there is no sanction restricting the French company from selling THEIR OIL to a US refinery. But, of course, the sh*t would hit the diplomatic fan if that went down. But if the oil goes to a French tank farm, mixed with oil from Nigeria, Equatorial Guinea, etc. And then some oil is shipped from there to a US refinery…where did that oil one from? I believe the operative word is fungible.
And those sanctions about Iran’s nuke program: Six world powers (the so-called P5+1 — the United States, China, Russia, Britain, France and Germany) and Iran have reached a deal on the framework for comprehensive negotiations over Tehran’s nuclear program. But as punishment for Crimea Russia has been unfriended by the rest of the P5+1 and not allowed at their last slumber party. So perhaps Russia considers their pledge is now void. The rest of the P’s might not agree but what are they going to do to Russia…double unfriend them? LOL.
Arthur on Sat, 5th Apr 2014 7:48 am
Wait until the BRICS are going to sanction the dollar for real.
http://www.sott.net/article/276052-Pepe-Escobar-Russian-sanctions-as-war-and-farce-and-their-implications
Davy, Hermann, MO on Sat, 5th Apr 2014 11:30 am
Yea, Art, the Brics make up 21% of global GDP. Their currencies are currently in disarray and most are deficit spending. Sure, Art, I think they are very good candidates to move on the dollar with a US economy that is larger than all the Brics combines??????. More likely behind the scenes they are going to the fed on their knees begging for some relief. QE has most notably help these basket case economies support their unstainable deficits. China is in no position to move on the dollar with its current dangerous debt unwind. India has a few months of Reserve currency of any kind to pay for its imports. In a debt unwind the last thing you want is more central authority induced market volatility. If the world would just leave macroeconomics to the market the world economies would settle out. May not be pretty but what they have done now will be downright ugly. I do not believe in the market to solve our predicaments but it is a better cure than central banks experimenting with policies by trial and error. Eventually another system of some kind will have to step in when the global system implodes. I believe in many cases this will be military/civilian rule. Currently, these central banks have gone past the point of no return and we are in a debt Ponzi scheme bubble. The worst is in China, followed by Japan, US and EU.
bobinget on Sat, 5th Apr 2014 4:05 pm
http://www.eenews.net/stories/1059975505
By all means check out text in link above.
Then, Google https://www.google.com/search?q=melting+permafrost+Russian+Pipelines&client=safari&rls=en&tbm=isch&tbo=u&source=univ&sa=X&ei=9SFAU5rzNKPB2wWcv4DwCg&ved=0CDUQsAQ&biw=1280&bih=719
Now, open as many links as you have time for concerning warm water port of Sevastopol, Crimea.
http://www.huffingtonpost.com/2014/04/02/yanukovych-interview-crimea-ukraine_n_5075829.html?utm_hp_ref=world
Having already put forward a theory Putin is angling
to corner half the world’s oil markets. (Judging by military progress being made on behalf of Syrian Government forces, this looks possible)
Fact: Quickly melting permafrost is endangering Arctic pipelines, access roads, airports, housing.
(Alaska is experiencing similar difficulties)
Fact: Russia needs pipeline, shipping assets in Crimea now more then ever.
Fact: in a long game Western Europe cannot long survive W/O Russian gas.
Arthur on Sat, 5th Apr 2014 4:11 pm
the Brics make up 21% of global GDP.
US similar.
The point is that notably China has so many dollars (3T) that they are now seriously contemplating if it makes any sense to continue delivering real values to the US for yet another trillion in green paper with zero inherent value. The more dollars you have, the less likely it becomes to ever see real values in return. China has indicated repeatedly that the tipping point is in sight. In case of a major conflict, China could dump the dollar and start buying up everything of value, thereby flooding markets with the dollar, causing sellers to stop accepting the dollar.
bobinget on Sat, 5th Apr 2014 4:11 pm
If this summer proves to be as warm as last in Russia’s
Arctic and America’s Alaska there will be undeniable consequence. I’m not saying ’causes’ of that damage
won’t be denied, they will. However, discontinuation of Alaskan oil and Siberian gas will be impossible to cover-up.
Davy, Hermann, MO on Sat, 5th Apr 2014 5:36 pm
Art, China is in a debt spiral. China has engaged in monetization that dwarfs the US and Japan. The difference is China’s currency is not convertible like the dollar so the market behavior is different than the dollar that is a global reserve currency. China has a streak of pride where they will say one thing to look good but reality is a different story. Why do you think the rich Chinese are moving money oversees??? Because they know the Chinese economy is a paper dragon ready to flame up. China has been buying dollars in the first place to keep their currency value low so they can run an export driven economy. They are not in a good position to allow their currency to appreciate against the dollar. Besides let them dump dollars and watch their investment in dollars evaporate. Markets are structured to have a balance of buyer and seller so if they dump dollars the market may freeze up. It will only hurt China and the rest of the global system. It is bluster if you ask me not an intended economic strategy.
Arthur on Sat, 5th Apr 2014 6:35 pm
Davy, how many years you think will China continue with this pattern:
http://investmentwatchblog.com/shocking-facts-about-the-deindustrialization-of-america-that-everyone-should-know/
US-Chinese trade deficit:
1990: 10 billion dollars
1991: 12 billion dollars
1992: 18 billion dollars
1993: 22 billion dollars
1994: 29 billion dollars
1995: 33 billion dollars
1996: 39 billion dollars
1997: 49 billion dollars
1998: 56 billion dollars
1999: 68 billion dollars
2000: 83 billion dollars
2001: 83 billion dollars
2002: 103 billion dollars
2003: 124 billion dollars
2004: 162 billion dollars
2005: 202 billion dollars
2006: 234 billion dollars
2007: 258 billion dollars
2008: 268 billion dollars
2009: 226 billion dollars
2010: 273 billion dollars
2011: 295 billion dollars
2012: 315 billion dollars
2013: 318 billion dollars
China has too many dollars. They certainly want to trade with the US, but the acceptance of the dollar is nearing the end. They are buying up gold as mad men, but that market is now almost empty. What the Chinese are doing additionally is spending the money on US assets. But these assets can be frozen in case of conflict. You don’t want too many of that as well. What you really want is assets in China.
the Chinese economy is a paper dragon ready to flame up
Why? I don’t think so. What is necessary for China is converting itself from an export driven economy towards producing more for their internal market, than for the US market, that essentially is not paying for Chinese products.
bobinget on Sat, 5th Apr 2014 10:40 pm
Yeah, Chinese are choking to death in all their
major cities and we aren’t.
Jokes on them.
Don’t look now Arthur, USD, one of world’s strongest.
Arthur on Sun, 6th Apr 2014 11:46 am
Yeah, Chinese are choking to death in all their major cities and we aren’t.
True.
Don’t look now Arthur, USD, one of world’s strongest.
Not true, but instead a Bretton-Woods leftover of clever geopolitical maneuvering of the US elite in the past (WW2). The trade balances show where the real (industrial) strength is (China, EU, Japan, Korea) and not in the US, not any more.
The old libertarian joke is that the US consumes what the rest of the world produces under the pretense that the US ’employs the rest of the world’. Sure. Meanwhile the rest of the world sees through this sc.. err comparative advantage and has quietly started to act against it. At some point it will be difficult for Americans to find suppliers who still accept the dollar and beyond a certain tipping point all the dollars will move home where they can’t be refused as legal tender –> hyper-inflation. The US will be forced to resort to barter on international markets from then on. That will be the moment when Washington will be forced to rigorously apply the red pencil and cancel all these goodies that made the difference between a ‘global benevolent hegemon’ and just another ‘benevolent great power’.
We feel your pain. Been there, done that.
Davy, Hermann, MO on Sun, 6th Apr 2014 12:10 pm
Art said – Not true, but instead a Bretton-Woods leftover of clever geopolitical maneuvering of the US elite in the past (WW2). The trade balances show where the real (industrial) strength is (China, EU, Japan, Korea) and not in the US, not any more.
Art, part of having a global reserve currency is having a trade deficit. There are systematic reason for this. Your caricatures is off key on the “where the strengths are” The US along with the other major economic powers you mention all have comparative advantage and disadvantages. The US may not be the power it once was agreed but the US is a large country with many manufacturing strengths. The EU is not what it once was and in rapid decline for a number of reasons. China produces junk that the world does not really need. Japan is in rapid decline. In any case all these mention powers are in a slow death spiral of the end of the age of industrial man. The US is best positioned for this retreat because of lower population densities and advantages in arable land.
Arthur on Sun, 6th Apr 2014 1:36 pm
Davy, nobody suggests that the US are going to evaporate
part of having a global reserve currency is having a trade deficit. There are systematic reason for this.
Yes, history.
And again, as you indicate yourself, the long term prospects for the US population to survive are relatively favorable, for the reasons you mention.
But the idea that 180 million Euro-Americans are going to dominate 500 Europeans, 200 million Slavs, and 1300 million Chinese much longer, just because the Zionist dominated US elite wants to see that happen, that idea had it’s day. Yes, we (US, EU, Japan, not yet Russia and China) are all in decline, but some are more in decline than others.
https://www.youtube.com/watch?v=GFdYT8OI6b0