a lot of people don't realize that there is some evidence to suggest saddam hussein was rotating away from the US dollar for his oil trade before the gulf war started.
now iran is doing the same. is there any wonder why we have a carrier battle group of warships in the strait of hormuz? imo this flap over their nuclear ambitions is the public face of a much more hidden conflict: they are steering away from a weak US dollar in their oil trade, and this will make the US dolllar just that much weaker in the process.
this could get really ugly, imo.
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About 70% of Iran Oil Income in Non-US Dollar
TEHRAN (Fars News Agency)- Iran, embroiled in a row with Washington over its nuclear program, has increased the amount of its oil export earnings in currencies other than US dollars to about 70%, an Iranian official said.
The figure is up from 60% cited in March for Iran's non-dollar oil export income and reflects the No. 2 OPEC producer's policy of reducing exposure to the greenback.
"About 70% of our oil export income is now in currencies other than the US dollar," Hojjatollah Ghanimifard, international affairs director of the state-owned National Iranian Oil Company (NIOC), told Reuters.
"If the dollar gets weaker, we will increase that percentage," said Ghanimifard, who in March had cited a figure of 60% for Iran's oil export income in other currencies.
Iranian officials have said they are seeking to limit dollar-denominated trade. The central bank governor has said Iran was seeking to "distance" itself from dollars and held just 20% of its foreign reserves in the US currency.
"We are following our government's monetary policy not to depend on the weak US dollar," Ghanimifard said, speaking on the sidelines of a conference in Tehran organized by Iran's Ravand Institute for Economic and International Studies.
The United States has been leading efforts to try to isolate Iran over its nuclear program, which Washington says involves a covert plan to make atomic bombs, a charge Tehran denies vehemently.
Washington has slapped sanctions on two Iranian banks, a move that unnerved some international banks working with Iranian businesses and prompted many to halt dollar transactions. UN sanctions have added to worries by targeting an Iranian bank.
"The US administration has tried to deprive NIOC of money. We have found other ways to compensate for the shortfall. Proof of that is that our oil production capacity and production of gas and petrochemical products have increased," Ghanimifard said.
"A chunk of money came from the Oil Stabilization Fund (OSF) and some from an additional budgetary hard currency allocation to NIOC," he said.
Iranian media said this week Iran planned to use foreign exchange reserves to finance a $2 billion development plan for parts of its South Pars gas field after a French bank pulled out.
The OSF, a fund set up to save windfall oil earnings in times of need, forms part of the country's foreign reserves.
Industry sources say Iran now produces about 4 million barrels per day (bpd) of oil and exports about 2.4 million bpd. In the year to March, Iran earned about $53 billion from its oil exports, an oil official said.
Ghanimifard said that figure could be higher in the current Iranian year to March if oil prices continued to rise.
Benchmark Brent crude is now hovering around $70 a barrel, within sight of last year's record highs. Iranian crude tends to trade several dollars below Brent prices.
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