Young Journalists Club | Latest news of Iran and world

News ID: 7058
Iran » Iran
Publish Date: 19:26 - 04 January 2017
The world's largest oil trader, Vitol, has clinched a deal with the National Iranian Oil Co. (NIOC) to loan it an equivalent of $1 billion in euros guaranteed by future exports of refined products, four sources familiar with the matter said.
Vitol clinches $1 billion oil deal with IranIt highlights the speed of the oil industry recovery in Iran just a year after lifting of sanctions.

Foreign companies still tread carefully for fear of breaking a myriad of complex laws, and oil majors such as Shell (RDSa.L), BP (BP.L) and Eni (ENI.MI) have been slow to return as regular crude lifters.

Executives who are U.S. citizens are often ring-fenced from negotiations with Iran, notably BP's CEO Bob Dudley and even those working for non-U.S. companies.

But privately held trading houses are more flexible and can negotiate deals quicker than listed firms.

The Vitol Iranian deal was signed in October and will come into effect this month, one of the sources who is based in Tehran said.

"It is in euro...with the interest rate of around 8 percent in exchange for oil products," the source said, adding that some products could be supplied by the private sector rather than NIOC.

Major crude producers in the Middle East, including Iran, remain reluctant to sell crude oil to traders as they prefer to control pricing and destination themselves, Reuters reported.

OPEC's third-largest oil producer, Iran, exports more than 500,000 bpd of refined products, mainly fuel oil, petroleum gas and naphtha to Asian markets, according to OPEC.

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