Iran 'may adopt UAE dirham for oil exports to Europe'



Iran is floating the idea of switching payment for its crude oil exports to Europe from the euro to the UAE dirham, according to a report in International Oil Daily, in what appears to be an attempt to blunt the impact of financial sanctions soon to be adopted by the European Union. The newsletter said the National Iranian Oil Co has been talking to its European customers about the change, although no final decision has been made. Iran currently follows global practice and prices its exports in US dollars.

International Oil Daily suggested Iran may not be able to persuade European customers to make the switch because of their unfamiliarity with the dirham, although it is pegged to the US dollar. The European Union is considering sanctions that could affect Iranian banks and the operations of the country's central bank, in the continuing row over Iran's nuclear plans. Iran, which holds around 10 per cent of the world's oil reserves, is the world's fourth-biggest oil exporter and the second-largest producer in OPEC after Saudi Arabia.

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