In the nice problem to have department, Shell is doing its very best (or so they say) to settle a $1 billion bill for about four large tanker loads of Iranian crude. The problem: Sanctions make payments to Iran hard if not impossible.
“Shell is working hard to figure out a way to pay. It’s very sensitive and very difficult. They want to stay on good terms with Iran, while abiding by sanctions,” a source told Reuters.
Shell was one of Iran’s top clients, along with France’s Total and Turkey’s Tupras. After sanctions on Iranian oil were declared, companies have until July 1 to take last deliveries of oil. Payment however is a whole different matter.
“It is now nearly impossible to use the banking system,” an oilman told Reuters. Payments had been hard for a while. Dubai banks used to be able to facilitate payment in and out of Iran, but this has stopped following pressure from Washington.
Isn’t this a problem we all would like to have?
Iranian sanctions: Great. Here’s a toast to higher pump prices… However, it might make the trade in on my fuel efficient 11 year old Toyota better than it already is.
Bag-drop in the Straits of Hormuz should do the trick!
The US doesn’t use Iranian oil. It’s going to Europe. I’m surprised that the money can’t go through Germany or Switzerland. For a fee, of course.
Yes, Germany and France – the two worst best friends you could ever ask for, will pick up the slack. They always do.
Mail them a check and if they receive it they can figure out a way to cash it.
Man wouldn’t you hate to get collection calls from Iran!
Send me the money. I know an Iranian. We’ll go to ‘Vegas.
Wonder what the payment terms are. Compounding interest rates would balloon up this debt when it does become legal to pay … unless they’re specifically excluded due to force majeure or something like that.
No one really follows the news…
The cnetral clearing house, the master routing for all financial transactions in the world are no longer processing money to or from Iran. Mailing them a check (imagine wiriting it) would not be processed.
It doesnt matter who makes what oil where or who uses it, oil prices are from a worldwide unitary market. Speculators drive the price up or down as supply and demand has very little effect on prices anymore in the world market (they do locally ie a refinery goes offline).
Must be a hell of a problem for the accounting office. Imagine a billion dollar check not being cashed on the books.