Iran Has Decided To Replace The Dollar With The Euro In It's Foreign Trade

[Jcrowley]

12/5/06
Iran to replace dollar with euro in foreign trade: Finance Minister

TEHRAN, Dec. 4 (Mehr News Agency) – Iran has decided to replace dollar with euro in its foreign trade given the continual impediments and hostile policies directed by U.S. toward the country, Iranian finance minister said on Monday.

According to ISNA, the would-be decision is also more attuned to existing trade volume between Iran and European nations, the country's major economic partners, which is transacted through the 'euro banks'. "Such inclination has been underlying part of our economic policy for awhile and our Oil Stabilization Fund (OSF) in dollar is at its lowest now," Davud Danesh-Jafari continued.

Back in September, the head of the Central Bank of Iran (CBI) Ebrahim Sheibani had threatened that Iran would resort to dollar-to-euro conversion if the U.S. pressure continued. Moreover, the 9/11 event seemed to consolidate a tentative unanimity being formed on this matter among Iranian statesmen after the emergence of euro in 2000.

Experts believe that less reliance on dollar and conversion to euro may increase Iran's financial flexibility and access to euro accounts would be easier if the U.S. chooses to impose a unilateral economic sanction on the country.

http://www.payvand.com/news/06/dec/1041.html

Iran replaces dollar with euro in most oil dealings

TEHRAN, Dec. 5 (MNA) — Iran has started replacing dollar with euro in majority of its crude oil exchanges in the last several months, an informed source with Iran’s Oil Ministry said here on Tuesday.
Oil Ministry has taken the policy to substitute dollar with euro, and begun to implement it for most of its oil dealings, the source who spoke on the condition of anonymity told the Mehr News Agency.
 
“This can maintain the real value of Iranian oil,” he added.
 
The majority of Iran crude’s customers are Asian and European states, the source noted.
 
Iran is the number two oil producing member of the Organization of the Petroleum Exporting Countries (OPEC). It also stands second behind Russia in terms of gas reserves in the world.
 
http://www.mehrnews.com/en/NewsDetail.aspx?NewsID=416994

[dysfunctional press]

1. isn't that one of the things that got ssaaddaamm invaded...?

and isn't that going to be harmful to the dollar?

[bahrbearian]

3. Well, we have to protect our strategic interest. .. Bombs away

[Art_from_Ark]

2. Iran seems to enjoy waving the red matador's cape

in front of the bu$h bull.

[bahrbearian]

4. Wait until Saudi Arabia changes to the Euro ,, and thats not to far away

[majorjohn]

7. Saudi will never do that

They're US's favorite in the region, after Israel that is.

[AlamoDemoc]

12. Saudi Arabia will never change their oil bourse to euro...

because over the years Saudis have allocated an estimated 60% of their global investments to the United States through passive and direct investments. Many of Saudi Arabia's return-dollar-oil is invested in the US...such investment produce in the neighborhood of 2.3 to 2.5% return as investment. I doubt the Saudis would want to jeopardize that type of guaranteed investment.

[majorjohn]

5. Ironically, the only difference is...

they actually take a long time to think about their plans, rather than just rush into things.

[madokie]

8. I think their prez knows little britches is on the verge of a meltdown and he is pushing it for all

its worth.

[htuttle]

16. I think they have determined that the bull doesn't have any horns anymore...

...correctly or not, and that by pushing Bush, they gain prestige in various ways.

Post WWII especially, I think there's been an increasing power struggle between the powers within the Middle East, using Superpower-backing against their regional competitors the same way the Superpowers imagined they were using the nations of the Middle East as 'pawns' against the other Superpowers -- ie., I think there has been something of of a three way competition between the secular/socialist Arab nations (formerly Syria, Iraq and Egypt), Shiite Iran and Sunni Saudi Arabia.

We took Iraq out, bought Egypt with cash, and seem to have boxed in Syria and they seem to have thrown in with Iran to an extent, so now the struggle may just be between Saudi Arabia and Iran. In that game, it is the backing of the US, Europe, Russia and China that are the pieces to be played.

[KittyWampus]

25. Your post seems very astute and concise. Honestly, I think you nailed it

a very involved situation in 2 easily understood paragraphs.

[AlamoDemoc]

6. Indeed, a successful Iranian euro bourse would undermine the greenback

Everyone should know that America's currency monopoly is the perfect pyramid scheme. As long as nations are forced to buy oil in dollars, the United States can continue its profligate spending with impunity and war to maintain its supremacy.

[Redstone]

9. And we should give a shit...why?

Redstone

[The Doctor.]

17. Your wallet just got lighter.

You just don't know it yet.

[Redstone]

20. Not me, cool. All of my investements (Eagles, Mapleafs, and Kruggerrands) are buried

in the back yard, safe and sound.

Redstone

[The Doctor.]

26. You don't keep greenbacks in your wallet?

I'm very happy for you. You've managed to shore up some savings and put it in gold. Hope you have the security to protect it.

I've been thinking of going the same route with my investments. I may put a little more into foreign currency for the few months it skyrockets with respect to the dollar. But the 'buried treasure' scenario is looking tempting lately.

Meanwhile the effect this is going to have on the US economy is potentially devastating, and unless you don't live here you should be very concerned.

[bobbolink]

10. Bomb the heck outta those infidels!!

:silly:

[kineneb]

11. and the dollar is in trouble

this may be the last straw... and when does BushCo start the bombing? After all, as others above have mentioned, Saddam wanted to move to using the Euro.

http://www.buzzflash.com/articles/contributors/606
-snip-
"If the economy is going so great, why do I sense it's so lousy? At the risk of being dismissed as a Chicken Little or the Grinch of Christmas Coming, or even worse, as some Al Gore wanabee ridiculed for warning of too many glaciers melting away in the global warming sun, I am amazed at why our media is looking away from economic bubbles bursting at home, and more focused on the war than our own economic crisis.

I certainly understand the concern about withdrawing from Iraq. I have been supportive of getting out before we went in. Yes, it's a mess and getting worse and I am sure we will soon be hearing about the Fall of Baghdad the way we woke up one morning to discover The Fall of Saigon.

When are we going to start worrying about the Fall of America? Our prestige has certainly fallen worldwide. Our dollar is in the dumps. And the American economy is headed the same way."
-snip-

also, lots of interesting econ articles have been at Asia Times online:

http://www.atimes.com/

[stillcool]

13. I don't know what to think anymore...

---> Iran-US-Saderat Bank-Transactions
U.S. Asks Finance Chiefs to Limit Iran's Access to Banks
September 17, 2006, Sunday
By STEVEN R. WEISMAN (NYT); Foreign Desk
Late Edition - Final, Section 1, Page 8, Column 3, 812 words

DISPLAYING ABSTRACT - The United States pressed the top finance officials of the world's leading industrial nations on Saturday to crack down on what Treasury Secretary Henry M. Paulson Jr. said was the exploitation of their banking systems by at least 30 Iranian front companies involved in illicit activities. Mr. Paulson said ...

On the 8th September, 2006, the US Treasury prohibited all US banks from trading with Saderat , one of Iran biggest banks.According to treasury secretary, Henry Paulson, the Iranian bank was financing terrorism. This prohibition extends to a whole series of banks having subsidiaries in the USA.
In an interview on the 16th September with Emerging Markets, published on the fringe of the anual meeting of the 183 governors of the central bank members of the IMF and the World Bank, Ebrahim Shebanu, director of the Iranian central bank has declared Saderat's innocence. He underlined that in order to continue its activities, Saderat found itself constrained to abandon the dollar. As a result, the Iranian central bank envisaged partial sale of its dollar holdings and abandoning the use of that currency.Mr Shebanu added that, given this circumstance,Iran had decided to transfer its international transactions to clearing houses in Saudi Arabia and Bahrain.
http://www.voltairenet.org/article143510.html
http://iransolidarity.endofempire.org/news.php?page=989

Saderat Bank of Iran explores int'l channels to thwart US sanctions
Tehran, Nov 29, IRNA

Iran-US-Saderat Bank-Transactions
Saderat Bank of Iran explores international channels to thwart US financial sanctions, managing Director of Saderat Bank Hamid Borhani said on Wednesday.
"Saderat Bank of Iran has replaced US dollars euro in its international transactions to deal with the US measure."
He lambasted the US department of the Treasury for taking illegal action against Saderat Bank of Iran and said that Saderat Bank of Iran will take action with International Monetary Fund (IMF), the World Bank (WB) and the World Trade Organization (WTO) against the US action creating nuisance for Iranian trade with the free world.

>>>"Saderat Bank of Iran reserves the right to explore appropriate international channels to defend its rights."
Borhani said that some 60 to 70 percent of transactions of Saderat Bank were in US dollars, but, following the US financial sanctions, the Bank decided to open up Letters of Credit (LCs) in currencies other than US dollars.>>>

>>>"Currently, the level of transactions in US dollars has fallen from 70 percent to 50 percent. The process will gain momentum with fulfillment of the former commitments," Borhani said.

He said that the US Department of the Treasury has taken political action against Saderat Bank of Iran with posing sanctions threat to parties to transactions with Saderat Bank of Iran which is a non-professional practice.>>>

AP
Angola, Sudan Look to Join OPEC
Thursday November 30, 11:20 am ET
By Casimiro Siona, Associated Press Writer
Angola, One of Africa's Largest Oil Producers, and Sudan Seek to Join OPEC

LUANDA, Angola (AP) -- Angola, the largest sub-Saharan oil producer in Africa after Nigeria, said it will apply to join OPEC next month, while the oil cartel's secretary general said Sudan also was poised to join.

OPEC Secretary General Mohammed Barkindo, speaking to Dow Jones Newswires on Thursday on the sidelines of a producers' meeting in Egypt, gave no timetable for Angola or Sudan to join the group, which has not welcomed a new member since 1975.

Joining offers prestige, but would mean adhering to OPEC production quotas -- though members routinely violate the limitations. OPEC agreed in October to cut total production by 1.2 million barrels a day to about 26.3 millions barrels a day as of Nov. 1, and further cuts aimed at shoring up prices could be coming. OPEC controls about 40 percent of the world's daily oil consumption.
Angola steered closer to the United States in the early 1990s and has maintained close ties with France. However, since the civil war ended Angola has deepened cooperation with China and, more recently with Russia.

Last month Russia's OAO Lukoil and Sonangol signed a memorandum of understanding on joint exploration of Angola's offshore oil fields.http://biz.yahoo.com/ap/061130/angola_opec.html?.v=6

Iran Strengthens Ties With Afghanistan
Nov 29, 2006
AP

From cheap ice cream to 24-hour electricity, Iran is strengthening economic ties with western Afghanistan that could undermine support for U.S. and NATO forces.

Western Afghanistan has a newly paved 75-mile stretch of highway between the Iranian border and its main city, Herat, courtesy of the Islamic republic. Iran is also considering building a rail line on the busy route, and has pledged another $560 million to help rebuild Afghan infrastructure and businesses.http://www.iranian.ws/iran_news/publish/article_19185.shtml

[Jcrowley]

23. Excellent Post

GlobeAndMail.com is reporting that President Chavez of Venezuela is considering following Iran's move towards pricing oil in Euros. Venezuela has 5.4% of the export market, although since the bulk of his country's exports are of heavy oil to the US, where it needs special facilities to process it, it would be a very brave or foolhardy President that told the US to buy its oil in Euros, or else ... Nevertheless, you can see the attraction for any country wanting to apply some pressure on the world's superpower. And where Venezuela leads, Bolivia may not be far behind. You can see how this could quickly get out of control.

While the Iranians have been suffering numerous delays in implementing their bourse, Russia could have their oil market up and running almost as soon as their currency market is ready to take on the work load, which might only be a few months away.

Some commentators on the Iranian proposal have suggested that the impact on the US Dollar would not be so great because the greenback is used for all sorts of trade, not just oil, so 5.8% of the international oil trade is really only a small part of the bigger picture. This argument looks a bit weak if both Russia and Iran will be lowering the demand for Dollars to buy oil and gas.

In order to counter the reduced demand for US Dollars, the standard control lever available to the Federal Reserve is to increase interest rates, over and above what it was going to be doing. This has the usual unwelcome consequences of dampening the US economy, and squeezing people with mortgages, which in turn leads to rising wages, falling house prices and a slump in the construction industry.

http://www.energybulletin.net/16110.html

[GenDem]

14. Uh Ohhh

:scared:

[lovuian]

15. No more cheap oil

Its higher prices at the pump
cause the Saudis will want their share of the pie

[majorjohn]

18. There was never cheap oil

atleast for the past few years now...

[windbreeze]

19. they are slacking....Saddam did this in Nov...and look what it got him....

soooooo, I wonder if this is enough to warrant the attack, we all know * wants...
windbreeze

[lovuian]

21. kick

:kick:

[rman]

22. I welcome Iran to the Axis of Euro

[Horse with no Name]

24. War with Iran is imminent now

if it wasn't already.