Iran Moves Foreign Assets amid Sanction Threat
Iran calls for oil output cut
By Gareth Smyth and Najmeh Bozorgmehr in Tehran and Carola Hoyos in London
Published: January 20 2006 12:03 Last updated: January 20 2006 20:21
Iran has called for a cut in global oil production while simultaneously preparing to shift its foreign assets out of Europe.
The moves were widely interpreted as a signal that Iran is preparing for a long stand-off with the west and sees oil production as a counter weight to international economic pressure.
Tehran’s call on Friday for the Organisation of the Petroleum Exporting Countries to reduce production by 1m barrels a day helped take prices up to a four-month high of more than $68 a barrel, even though Iran is the only Opec member to call for the cut and is unlikely to find much support for the measure at Opec’s meeting in Vienna on January 31.
Some traders said Iran’s comment was a sign that Tehran might be willing to use the threat of halting its substantial oil production as a political tool in its nuclear spat with the west. Iran is the fourth biggest oil exporter and main supplier to Japan, South Korea, France and Italy. The media in Iran this week has highlighted the upward pressure on oil prices simply through talk of sanctions.
Just hours earlier, Ebrahim Sheibani, the Central Bank governor, said Iran would “transfer the foreign exchange reserves wherever we consider expedient” and confirmed a shift from Europe had begun.
Analysts say Iran is fearful that its deteriorating relationship with Europe could lead to a seizure of assets.
Mr Sheibani refused to give details or to say where Iran’s funds were going, although several local news agencies reported the destination was south-east Asia. The Central Bank manages Iran’s “windfall” oil revenue in the Oil Stabilisation Fund, which Mr Sheibani said would contain about $15bn (€12.4bn) by the end of March. Iran keeps an unknown amount of this in Europe.
According to the International Monetary Fund, Iran’s foreign exchange reserves are $30.6bn in hard currency. Tehran has another $9bn in foreign assets (but not necessarily liquid) abroad, it says.
A court in Rome last month ordered Banca Nazionale del Lavoro to freeze an account held by the Iranian government, pending a lawsuit over the deaths of three Americans in the Israeli-occupied Palestinian territories.
Iran has protested that its official accounts were protected by the Vienna Convention governing diplomatic relations. But families of US citizens killed in the bombing of its Beirut embassy in 1983 by Hizbollah, the Lebanese Shia militant group, plan to follow suit – asking European courts to seize Iranian assets after a US ruling that Iran should pay $126m in damages.
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By Gareth Smyth and Najmeh Bozorgmehr in Tehran and Carola Hoyos in London
Published: January 20 2006 12:03 Last updated: January 20 2006 20:21
Iran has called for a cut in global oil production while simultaneously preparing to shift its foreign assets out of Europe.
The moves were widely interpreted as a signal that Iran is preparing for a long stand-off with the west and sees oil production as a counter weight to international economic pressure.
Tehran’s call on Friday for the Organisation of the Petroleum Exporting Countries to reduce production by 1m barrels a day helped take prices up to a four-month high of more than $68 a barrel, even though Iran is the only Opec member to call for the cut and is unlikely to find much support for the measure at Opec’s meeting in Vienna on January 31.
Some traders said Iran’s comment was a sign that Tehran might be willing to use the threat of halting its substantial oil production as a political tool in its nuclear spat with the west. Iran is the fourth biggest oil exporter and main supplier to Japan, South Korea, France and Italy. The media in Iran this week has highlighted the upward pressure on oil prices simply through talk of sanctions.
Just hours earlier, Ebrahim Sheibani, the Central Bank governor, said Iran would “transfer the foreign exchange reserves wherever we consider expedient” and confirmed a shift from Europe had begun.
Analysts say Iran is fearful that its deteriorating relationship with Europe could lead to a seizure of assets.
Mr Sheibani refused to give details or to say where Iran’s funds were going, although several local news agencies reported the destination was south-east Asia. The Central Bank manages Iran’s “windfall” oil revenue in the Oil Stabilisation Fund, which Mr Sheibani said would contain about $15bn (€12.4bn) by the end of March. Iran keeps an unknown amount of this in Europe.
According to the International Monetary Fund, Iran’s foreign exchange reserves are $30.6bn in hard currency. Tehran has another $9bn in foreign assets (but not necessarily liquid) abroad, it says.
A court in Rome last month ordered Banca Nazionale del Lavoro to freeze an account held by the Iranian government, pending a lawsuit over the deaths of three Americans in the Israeli-occupied Palestinian territories.
Iran has protested that its official accounts were protected by the Vienna Convention governing diplomatic relations. But families of US citizens killed in the bombing of its Beirut embassy in 1983 by Hizbollah, the Lebanese Shia militant group, plan to follow suit – asking European courts to seize Iranian assets after a US ruling that Iran should pay $126m in damages.
Link Here
posted by Kangaroo Brisbane Australia at 5:30 PM
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