Obstacles slow Iran’s return to the market
OREANDA-NEWS. Iran's return to the international market is opening opportunities for trading companies following the lifting of US and European nuclear-related sanctions. But barriers remain, the heads of leading trading firms said today.
Around 300,000-500,000 b/d of Iranian production has returned to the market, according to some trading firms, but a further increase depends largely on Iran's technical capabilities, trading firm Glencore's oil chief executive, Alex Beard, said. It is unlikely that there will be a substantial transfer of technological expertise from western companies to Iran in the next 6-18 months, he said at the FT Commodities Global Summit in Lausanne today.
Trading firm Trafigura chief executive Jeremy Weir said the capital, banking and insurance structures are not yet in place to guarantee solid investment in the country, and western banks remain cautious. Trading firm Gunvor chief executive Torbjorn Tornqvist agreed that obstacles remain. Some US sanctions are still in place, and many companies remain wary of trade with Iran. And some companies trading with Iran are conducting trade in euros to avoid using US dollars.