Iran is planning to supply its oil to foreign customers through Iran Energy Exchange (IRENEX) Ali Kardor, the managing director of National Iranian Oil Company (NIOC) announced this in an interview with IRNA. The second round of sanctions by United States of America will come into effect on 4th November 2018 and the decision of Iran to supply its oil in IRENEX is part of the government`s plan to tackle U.S. sanctions, diversifying methods of supply of Iran`s oil and also cooperation of private sector in offering Iran`s oil. NIOC has been announced that Iranian buyers and foreign buyers can participate in this market and over 100 codes have been registered at IRENEX. It seems that NIOC and Ministry of Petroleum are serious to execute this plan this time as the issue of offering crude oil in the stock market dates back to March 2000 and since then this issue has been discussed several times. This offering will start from 28th October 2018 for one week. All the buyers can participate in this market and the volume of supply is 1 million barrels per day. The clearing mechanism includes two parts: 20 percent in Rial in cash and 80 percent in Dollar. Clearing of Rial part should be before receiving the shipment however, clearing the Dollar part will be done through bank guarantee and it should be through banks that NIOC approves it. The buyer should pay the 80 percent which is in Dollar currency after shipping in due dates which have been announced by NIOC in the beginning in supply notification. The base price will be announced by NIOC which is in accordance with trading price of international department of this organization and the buyers can compete on these prices. It is expected that; the existence of this competing environment will lead to detection of transparent and fair price. Iran`s oil export during last recent months had been reached to 2.1 million barrels per day however, the United States of America aims to decrease Iran`s export to zero but it doesn’t seem practical in reality as the price of oil will jump above 100 dollars per barrel based on some analysis by many experts active in this field even after pumping more oil by Saudi Arabia and Russia. It should be noticed that in 2014, in the worst situation after imposing sanctions, Iran`s export fell to 1.1 million barrels per day and even in those harsh days it didn’t reach to zero.
In summary, it seems that this time Iran tries to use the previous experience in sanctions and preparing this market is a sign for that. However, it is crystal clear that the transparency is a must for the government considering the previous unsuccessful experience in this regard and this can be an alternative for Iran so export its oil.