Oil price leverage failed, Iran says

There are customers lining up, Iran's oil minister says.
By Daniel J. Graeber  |  Jan. 19, 2016 at 9:49 AM
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TEHRAN, Jan. 19 (UPI) -- Any effort to use leverage in the crude oil market to push Iran into an economic corner has failed, Iranian President Hassan Rouhani said Tuesday.

Iran emerged from the shadow of the U.N. sanctions regime during the weekend after it was confirmed Tehran met the terms of the multilateral nuclear agreement reached in July. Yukiya Amano, the director general of the International Atomic Energy Agency, told the agency's board of governors the way is now clear to verify Iran's nuclear commitments are implemented.

With sanctions pressures easing, Iran said it could get an economic lift through expanded international trading and through the addition of around 500,000 barrels of oil per day to the market.

Iranian Oil Minister Bijan Zangeneh said there are already buyers lining up for the extra crude oil.

"Yes, there are customers," he said.

Iran's return as a major global oil player comes as crude oil prices trade at historic lows. The International Monetary Fund said in a review of the Iranian economy that oil prices and postponed investment decisions have slowed economic growth for Iran. The Iranian government said the collapse in oil price was part of a broader plot meant to undermine its national development.

"There were those that did not want to see a successful Iran at the end of the [nuclear] talks and resorted to the plot of reducing oil prices," Iran's president said. "They failed in their attempt."

Iran's Central Bank said Tuesday mechanisms were now in place to reconnect with the European market after Iranian banks were removed from sanctions lists.

"This means that one main obstacle on the way of Iranian banks' international relationships is removed," the bank said in a statement.

Rouhani in the past blamed his predecessor, Mahmoud Ahmadinejad, for steering the economy in the wrong direction. Iran's Central Bank said inflation went from a monthly rate of 45.1 percent when Rouhani was elected in June 2013 to around 15.5 percent. It aims for single-digit inflation by March 2017.

The draft budget that will be submitted to lawmakers during the weekend will be the least dependent on oil in years, the president said.

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