TEHRAN (FNA)- Iranian Oil Minister Bijan Namdar Zanganeh dismissed oil-for-goods contract between Tehran and Moscow.


"We do not have any oil barter trade deal between Iran and Russia," Zanganeh said in a televised interview on Monday night.

The Iranian oil minister pointed to the endorsement of a memorandum of understanding (MoU) between the Iranian and Russian oil ministries, and said, "The Russian energy minister and I have not signed that MoU in our capacities as oil ministers, rather we have endorsed it as the heads of the two countries' joint cooperation commissions as economic issues other than oil and gas are included in it."

His remarks came as the western media said last week that Russian President Vladimir Putin is eyeing a $20bln (£11.8bln) trade deal with Iran that would see Russia sidestep Western sanctions on its energy sector.

Under the terms of a five-year accord, Russia would help Iran organise oil sales as well as “cooperate in the oil-gas industry, construction of power plants, grids, supply of machinery, consumer goods and agriculture products”, according to a statement by the Energy Ministry in Moscow, the Telegraph reported.

However, the Russian government mysteriously withdrew that statement last night, saying it would issue a new one on Wednesday, the Telegraph added.

Despite the U-turn, news of a possible agreement hit US markets. The Dow fell 139 points, or 0.8pc, led by energy companies such as Chevron, down 2.5pc, and ExxonMobil, down 1.9pc. Brent Crude fell 1.5pc before recovering to trade down 0.7pc at $104.61.

A deal could see Russia buying 500,000 barrels of Iranian oil a day, the Moscow-based Kommersant newspaper has previously reported. That would be about a fifth of Iran’s output in June and half its exports.

The move would be a win-win for both nations after they were hit with Western sanctions aimed at limiting their energy sectors.

The European Union recently unveiled a raft of measures to restrict certain oil exploration and oil drilling related products in Russia after what President Barack Obama called the country's "illegal actions" in Ukraine.

On Tuesday, the Russian President told regional leaders that “the political tools of economic pressure are unacceptable and run counter to all norms and rules”, adding that he had given orders to boost domestic manufacturers at the expense of non-Russian ones.

Meanwhile, Iran has faced sanctions due to its anti-US policies and a nuclear row with the West. The country has been locked in talks with six world powers - Britain, China, France, Russia, the US and Germany - to reach an understanding, with an interim deal to lift a ban on sales to the EU and limiting them to Asia agreed in November.

Despite the sanctions, Iran has been looking to boost oil production in recent months, setting a new output target of 5.7m barrels per day (bpd) of crude by 2018 - OPEC believes Iran is currently pumping about 3m bpd of crude. However, it needs the help of international oil companies, and Russian energy firms have repeatedly expressed an interest in teaming up with Iran.

Before Moscow’s retraction, Alexander Novak, Russia's minister of energy, said an agreement would not violate international obligations and is important given the current "reality".

The White House has previously said that reports of talks between Russia and Iran were a matter of "serious concern".

"If the reports are true, such a deal would raise serious concerns as it would be inconsistent with the terms of the agreement with Iran," Caitlin Hayden, spokeswoman for the White House National Security Council, said in January.

Last week, Zanganeh voiced satisfaction in the progressive trend of Tehran-Moscow cooperation in various economic, trade and banking sectors, and hoped that Iran and Russia would witness further expansion of cooperation after the implementation of the recently signed MoU.

"I had good negotiations with the Russian Energy Minister as head of Iran-Russia Joint Cooperation Commission" said Zanganeh after a meeting with Russian Energy Minister Alexander Novak in Moscow.

"The Iranian and Russian presidents have laid emphasis on expansion of economic cooperation between Iran and Russia as an important strategy," the Iranian minister added.

He underscored the significance of a banking MoU between Iran and Russia which, as the minister stressed, was an important document and called for its rapid implementation.

In the past years, Iran and Russia have vast cooperation in different fields, specially in political and economic spheres.

The two states also enjoy special positions on the international scene and have long had constant and regular consultations on key regional and global issues.

By Fars News Agency

 

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