Iran eyes oil for goods barter plan to fight sanctions

France’s President Emmanuel Macron left meets his Iranian counterpart Hassan Rouhani in New York

France’s President Emmanuel Macron left meets his Iranian counterpart Hassan Rouhani in New York

A third of all oil traded by sea passes through the strait and the US Navy regularly has direct, tense encounters with Iran's paramilitary Revolutionary Guard there.

The UAE, an American-allied federation of seven sheikhdoms on the Arabian Peninsula, hosts some 5,000 USA troops.

An Iranian lawmaker says the Islamic Republic is considering a plan to purchase goods only from countries that buy its oil.

"Iran will remain committed to the deal, as long as its interests are preserved", Rouhani said.

Since President Donald Trump's decision to withdraw in May, calling the agreement deeply flawed, European states have been scrambling to ensure Iran gets enough economic benefits to persuade it to maintain the nuclear curbs required in the deal.

The sanctions would include a universal ban on Iran over buying or acquiring U.S. dollars as well as restrictions over purchases of crude oil from the country and investing in its oil sector projects.

He did not elaborate, but an Iranian Revolutionary Guards commander explicitly said on Wednesday Iran would block any exports of crude for the Gulf in retaliation for hostile United States action. Under the accord, Iran agreed to reduce its nuclear facilities to have sanctions lifted to free up oil revenue and frozen assets of more than US$100 billion.

India, Iran's second-biggest customer, struck a defiant tone last month after the Trump administration unilaterally pulled out of the Iran deal, saying it only respects United Nations sanctions, though it slightly reduced Iranian purchases this spring ahead of the USA decision to pull out of the pact.

India may likely to fall back on the rupee-rial arrangement for importing oil from Iran in case the U.S. forces it to cut procurement of petroleum products from that country, the sources said. "We can not pre-judge what the United States will be doing", said a source.

Separately, Iran's interior minister Abdolreza Rahmani Fazli warned Tuesday that "if we close our eyes for 24 hours, 1 million refugees will go toward Europe through our Western borders" via Turkey.

The US has told India and other countries to cut oil imports from Iran to "zero" by November 4 or face sanctions, making it clear that there would be no waivers to anyone.

The sources said the U.S. was prepared to work with countries that are reducing their oil imports on a case-to-case basis. Saudi Arabia and Russian Federation are expected to make up the bulk of the extra oil production, since few other big oil producers have room to ramp up output significantly, if at all.

"I can't see how this market ponies up 2.3 to 2.4 million barrels a day in the next four months, at least without sending prices through the roof", Nephew said.

Rouhani also met the head of the Vienna-based International Atomic Energy Agency (IAEA), which is policing the restrictions the deal places on Iran's atomic activities in exchange for sanctions relief.

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