to keep buying, but Reuters news agency reports that Iran is actually demanding higher prices and tougher terms already.
If Iran gets its way, fresh deals to Asia’s refiners would mean more oil revenues to cushion the impact of possible sanctions by the European Union and others.
China is Iran’s biggest oil buyer and has helped protect Iran from tougher UN sanctions. There is no, indication, however, that Iran is conceding anything to the Chinese. After weeks of oil talks, frustrated Chinese negotiators who had hoped to take advantage of the international W political pressure on Iran still have no 2012 supply deals, Reuters reports.
Iran wants China’s state-run Sinopec, Asia’s largest refiner, and state oil trader Zhuhai Zhenrong Corp, to pay more, and faster, in 2012 than in 2011, sources familiar with the talks told Reuters.
Iran believes its terms for 2011 were too generous, and now wants to reduce the credit grace period for both Chinese buyers from 60 and 90 days to 30 and 60 days, the sources said.
Iran’s insistence on speedier payments was likely prompted by this year’s debacle in India.
Refiners bought billions of dollars worth of oil but were suddenly unable to pay for it legally after India’s central bank caved in to Western demands and stopped clearing payments. It took months to find an alternative payment mechanism. Iran now demands India’s refiners pay a hefty fee for delaying payments, sources at two refiners said.
“They have asked Indian refiners to pay about $15 million toward interest payments and exchange rate variations on an outstanding debt of about $6 billion between end-December and July,” one of the sources told Reuters.
Refiners say they should not have to pay interest because the delays were not their fault: they were willing to pay for the crude, but there was no way of doing so legally, and Iran was unwilling to accept Indian rupees.