Fartashphoto's Blog

Frost Over the World – Has US politics become too vitriolic?

Posted in Uncategorized by fartashphoto on January 15, 2011

Oil Trade Dispute Erupts Between India and Iran

Posted in Uncategorized by fartashphoto on December 31, 2010

Tehran refused to sell oil to India under the prohibitive new rules

Posted in Uncategorized by fartashphoto on December 30, 2010

A payments dispute between India and Iran escalated after Tehran refused to sell oil to India under New Delhi’s prohibitive new rules, sources on both sides said on Wednesday.

The Indian sources said officials from the central banks of the two countries will meet on Friday as Iran seeks to rescue trade worth around $12 billion (£7.7 billion) a year, at risk from rising U.S. pressure on countries trading with Iran to abandon all dealings.

Last week, the Reserve Bank of India said deals with Iran must be settled outside the Asian Clearing Union (ACU) system, used by central banks of member nations to settle bilateral trades.

Analysts predicted talks would be tough and that New Delhi may face a costly bill if it abandons Iranian oil imports.

Iran is under global pressure over its nuclear programme, and though United Nations sanctions do not forbid the purchase of Iranian oil, the United States has pressed hard for governments and companies to stop dealing with Tehran.

India is the biggest buyer of Iranian crude among ACU members, with state-owned refiners and privately owned Essar Oil taking around 400,000 barrels per day.


US praises Indian steps to tighten sanctions on Iran

Posted in Uncategorized by fartashphoto on December 29, 2010

The United States has praised India’s recent steps to tighten sanctions on Iran by barring its companies from a range of deals which are transacted though a key trade-finance clearing house.

“This is a significant action” by India, the Treasury Department’s point man on Iran sanctions, Stuart Levey, was quoted as saying by The Wall Street Journal.

Levey’s statement comes days after the Reserve Bank of India instructed its Banks to stop processing current- account transactions using the Asian Clearing Union (ACU).

Headquartered in Tehran, ACU was set up by the UN in 1974 to help facilitate trade in the region.

India is Iran’s biggest trading partner in business done through ACU. Besides RBI, it includes central banks of Bangladesh, the Maldives, Burma, Iran, Pakistan, Bhutan, Nepal and Sri Lanka.

On Friday, RBI said Indian firms can’t use the ACU mechanism when making payments for the import of oil or gas.


Prices in Iran increasing dramatically after lifting of subsidies

Posted in Uncategorized by fartashphoto on December 26, 2010

The Iranian government’s removal of decades-old subsidies for food and energy in an attempt to boost its troubled economy has spurred price increases on everything from fruit and vegetables to gasoline, generated work stoppages and emboldened the political opposition.

In Tehran, the nation’s capital, taxi fares that officially were to rise by 10 percent shot much higher as drivers imposed their own price increases. Some truckers across the country refused to work, complaining of government threats to revoke their permits if they raised their prices to offset higher fuel costs.

Crews on ferry boats operating between Bandar Abbas port and Qeshm Island in the Persian Gulf temporarily stopped working, complaining that the ticket prices set by the government had not gone up despite a four-fold increase in the price of fuel, the Mehr news agency reported.

The austerity measures, though long anticipated, have brought mounting public anger since they began Dec. 19. Government critics contend that they will hurt people with modest incomes while leaving the wealthy unscathed.

Some critics also say the government’s plan places the consequences of Iran’s confrontational foreign policy and nuclear program, which have provoked international economic sanctions, on consumers. Opposition leaders Mir-Hossein Mousavi and Mehdi Karroubi on Wednesday publicly questioned the wisdom of the new plan, calling it a “burden on the shoulders of the middle and lower classes.”

Iranian authorities say the cuts are part of an economic reform package that will contribute to the nation’s prosperity by reducing wasteful subsidies totaling as much as $100 billion a year.

Already, the prices of produce, diesel, gasoline, cooking oil, water and bread have risen dramatically. In downtown Tehran, the price of a loaf of brick-oven bread doubled overnight to 40 cents. Security forces have been deployed around the country in case public frustration boils over into civil unrest.


Iran Dissidents Speak Out

Posted in Uncategorized by fartashphoto on December 25, 2010

Another blow to the Islamic Republic’s oil business

Posted in Uncategorized by fartashphoto on December 25, 2010

India’s central bank has said it will not facilitate payments for Iranian crude imports, in another blow to the Islamic Republic’s oil business as global pressure on Tehran grows over its nuclear programme.

Although United Nations sanctions do not forbid buying Iranian oil, the United States has pressed hard for governments and companies to stop dealing with Tehran. Many oil majors and banks have abandoned their dealings since then.

U.S. President Barack Obama visited India last month and said he supported its bid for a permanent UN Security Council seat.

The Reserve Bank of India said in a statement on Thursday Indian oil imports payments to Iran will have to be settled outside the existing Asian Clearing Union (ACU) mechanism, which involves the central banks of India, Bangladesh, Maldives, Myanmar, Iran, Pakistan, Bhutan, Nepal and Sri Lanka.

Iran is a major oil producer and the only exporter among the ACU block, while India is the biggest importer among them. Trade with Iran faces credit hurdles due to sanctions.

India imported about 426,000 barrels per day from Iran in 2009/10, but this may decline as major refiner Reliance Industries has not renewed its term deal.

The sanctions make it difficult to open letters of credit, which are often required for the buyer and seller of a cargo to guarantee payment upon delivery or at an agreed future date.

A second industry source said the move could make imports extremely difficult.


Mullen: US `very ready’ to counter Iran on nukes

Posted in Uncategorized by fartashphoto on December 19, 2010

Oil and gas prices in Iran could rise starting Sunday, as the government initiates the latest phase of a subsidy regulation initiative aimed at bolstering the nation’s struggling economy.

President Mahmoud Ahmadinejad told Iranian TV on Saturday evening that prices for some energy-related items could change starting the next day.

“In this stage, we don’t want to release prices, rather we are going to regulate and reform them,” Ahmadinejad said, as quoted by the state-run IRNA news agency.

Iran has $10 trillion in oil resources alone, plus natural gas reserves worth between $3.5 and $4.5 trillion, International Monetary Fund mission Chief Dominique Guillaume said in an interview posted earlier this fall on that world body’s website. But its economy nonetheless has seen lackluster growth, including between 1% and 2% of GDP this past year.

Despite its abundance of fuel, Iran has been pushing to expand its nuclear program. Many in the international community, including U.S. officials, have expressed grave concerns and successfully pushed for sanctions fearing that Tehran might be trying to develop nuclear weapons.

With subsidies that effectively allowed domestic consumers to pay relatively little for oil and gas — far below what they or people anywhere else would pay on the world market — Iran was forfeiting potentially huge revenues, explained IMF Senior Economist Roman Zytek on his group’s website.

The Obama administration and its European allies are prepared to impose additional sanctions if Iran fails to meet international demands to prove that its nuclear program is peaceful, a senior U.S. official said Friday.

“From my perspective I see Iran continuing on this path to develop nuclear weapons, and I believe that that development and achieving that goal would be very destabilizing to the region,” Mullen said.

“We’re very ready,” Mullen said an unusually direct acknowledgment that the United States has contingency plans to counter Iran should it make a move. “There are real threats to peace and stability here, and we’ve made no secrets of our concerns about Iran.”

He gave no specifics about U.S. plans or defenses, but the Navy base is headquarters for ships and aircraft that monitor Iran and could be used to deter or defend against what military officials fear would be an attack that would come without warning. The base also houses Patriot missiles.

TEHRAN: Crude Potential in The Middle East! CNN Reports

Posted in Uncategorized by fartashphoto on November 22, 2010

MME examines the true oil potential of two of the Middle East’s most volatile oil and gas producers Iran and Iraq.

Japanese tanker incident in Persian Gulf

Posted in Uncategorized by fartashphoto on July 28, 2010

A mysterious explosion hit a Japanese oil tanker near Iran in the vital Strait of Hormuz early on Wednesday, spotlighting a potential threat in a chokepoint for global oil supplies.

There were differing theories about the cause of the blast — which did not cause any serious injuries or an oil spill — ranging from a terrorist attack to an explosion of gases.

Port officials in the neighboring United Arab Emirates even said the ship was hit by a tremor-triggered wave.

“Since one of the crew saw a flash on the horizon immediately before the blast, the company suspects it was highly likely an attack,” the ministry said, adding that the immediate area was not known for piracy.

It said one crew member was injured and the ship was partly damaged but able to keep sailing after the blast hit at 12:30 am (2030 GMT Tuesday).

The Strait of Hormuz, less than 100 kilometers (60 miles) at its widest point, separates Oman from Iran and is the gateway into the oil-rich Persian Gulf.

Mohammad Hakimi, an Iranian shipping official, told Mehr news agency “the blast on the Japanese ship happened in Omani waters.”

And Attollah Sadr, head of Iran Shipping and Ports Organization, ruled out a terrorist attack. “Because of inflammable gases and vapors in oil tankers, a blast is likely,” he told Mehr.

The Marshall Islands-flagged tanker, loaded with 270,000 tons of oil, was heading from the petroleum Port of Das Island in the United Arab Emirates to the Japanese port of Chiba outside Tokyo, the ministry said. After the blast, the tanker headed to the Emirati port of Fujairah under its own power.