Iran's Currency In Record Fall As U.S. Sanctions Loom

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Franklin Pierce

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DUBAI (Reuters) - Iran’s currency plunged to another record low on Sunday, dropping past 100,000 rials to the U.S. dollar as Iranians brace for Aug. 7 when the United States is due to reimpose a first lot of sanctions on their economy.

In May the United States pulled out of a 2015 deal between world powers and Tehran under which international sanctions on Iran were lifted in return for curbs on its nuclear program.

Washington decided to reimpose sanctions on Iran upon its withdrawal, accusing it of posing a security threat, and has told countries they must halt all imports of Iranian oil from Nov. 4 or face U.S. financial measures.

On Sunday, the Iranian rial plunged to 111,500 against one U.S. dollar on the unofficial market, down from about 97,500 rials on Saturday, according to foreign exchange website Bonbast.com. Other websites said the dollar was exchanged between 108,500 and 116,000 rials.

Iran currency extends record fall as U.S. sanctions loom
 
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#4
#4
Franklin Pierce said:
Washington decided to reimpose sanctions on Iran upon its withdrawal, accusing it of posing a security threat, and has told countries they must halt all imports of Iranian oil from Nov. 4 or face U.S. financial measures.
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As time goes along and more countries begin to fight and clamor for more economic growth and increased exports, you will see more push back from other countries against these sanctions by the US. Why should a country put its economic fate in the hands of our whimsical foreign policy? Countries are going to eventually do what is in the their best interests, not the best interests of the USA.
 
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#5
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#6
#6
DancingOutlaw said:
Texas is on pace to surpass Iran in production by next year. They might want to be careful about disrupting anything. The higher they drive the price the more US wells will produce.
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Then you get the catch 22 of the higher prices go up, the more it stalls the economy... which will drive down demand.
 
#8
#8
Rasputin_Vol said:
Then you get the catch 22 of the higher prices go up, the more it stalls the economy... which will drive down demand.
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If Iran wants to play the instability game it only hurts them and others in OPEC. The US has capacity to fill that gap should there be disruptions in the ME. Who knows how many shale oil sites are still idled waiting for a price increase. And as the technology improves the cost for those operations will continue to fall, so a price increase won't even be necessary to justify reactivating those sites.
 
#9
#9
DancingOutlaw said:
If Iran wants to play the instability game it only hurts them and others in OPEC. The US has capacity to fill that gap should there be disruptions in the ME. Who knows how many shale oil sites are still idled waiting for a price increase. And as the technology improves the cost for those operations will continue to fall, so a price increase won't even be necessary to justify reactivating those sites.
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Iran doesn't need to do jack diddly squat if they have China as a trading partner.

And Iran's ambitions and agenda run counter to some other OPEC members' agenda (e.g. Saudi Arabia), so not sure why they would care one way or the other about a potential OPEC blowback.
 
#10
#10
Rasputin_Vol said:
As time goes along and more countries begin to fight and clamor for more economic growth and increased exports, you will see more push back from other countries against these sanctions by the US. Why should a country put its economic fate in the hands of our whimsical foreign policy? Countries are going to eventually do what is in the their best interests, not the best interests of the USA.
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What’s so wrong with that?
 
#12
#12
Trump Admin Sanctions Iranian Paramilitary Group Training Child Soldiers

Sanctions hit banks, individuals supporting Iranian fighting force in Syria

The Trump administration on Tuesday leveled a bevy of harsh new sanctions on a top Iranian fighting force known to be training children and other soldiers that are engaging in terrorism in Syria and other regional hotspots, according to senior Trump administration officials.


The sanctions hit "a vast network" of businesses and financial institutions supporting Iran's Basij Resistance Force, a paramilitary organization tied to the Iranian Revolutionary Guards Corps, or IRGC, the Islamic Republic's chief fighting force that is widely known for conducting terrorist operations outside Iran's borders, including ones that have killed Americans.

The sanctions—part of the Trump administration's "maximum pressure campaign" on Iran—come after a series of Iranian missile and drone strikes in the region that have drawn widespread condemnation, including from the Trump administration.
Trump administration officials familiar with the new action said the sanctions are meant to expose Iran's global terrorism networks, including a web of financial institutions and shell companies that fund the rogue country's military intervention across the globe.

"The Bonyad Taavon Basij network is an example of how the IRGC and Iranian military forces have expanded their economic involvement in major industries, and infiltrated seemingly legitimate businesses to fund terrorism and other malign activities," Treasury Secretary Steven Mnuchin said in a statement. This vast network provides financial infrastructure to the Basij's efforts to recruit, train, and indoctrinate child soldiers who are coerced into combat under the IRGC's direction."

"The international community must understand that business entanglements with the Bonyad Taavon Basij network and IRGC front companies have real world humanitarian consequences," Mnuchin said. "This helps fuel the Iranian regime's violent ambitions across the Middle East."

The Basij's financial network consist of at least 20 corporations and financial institutions, all of which have been hit with sanctions ahead of a Nov. 4 deadline by which the Trump administration aims to reimpose all sanctions lifted by the Obama administration as part of its landmark nuclear deal with Iran.

Trump Admin Sanctions Iranian Paramilitary Group Training Child Soldiers
 
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#13
#13
Iran Sends Record Amount Of Oil To China

Tankers carrying some 22 million barrels of Iranian crude are on their way to the Chinese port of Dalian, Reuters reports citing ship-tracking data, and noting this is a record-high amount of crude from Iran to be received by Chinese clients amid falling imports to other large clients, such as Japan and South Korea. The usual rate of Iranian crude oil cargoes going into China has been between 1 million and 3 million barrels monthly.

“As our leaders have said it will be impossible to stop Iran from selling its oil. We have various ways of selling our oil and when the tankers reach Dalian, we will decide whether to sell it to other buyers or to China,” the Reuters source said.
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#20
#20
McDad said:
I'm not a sanctions guy. I believe our best chance at increasing freedom worldwide is continuing trade and economic relations.
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Deserved or not, sanctions against Germany really hurt their economy leading to them lashing out at their neighbors. The only time I know of where I would say sanctions "worked" is South Africa.
 
#21
#21
SWIFT Cuts Off Iran Central Bank As Tehran Sells 700,000 Barrels To Anonymous Direct Buyers
https://www.zerohedge.com/users/tyler-durden
As reported last week, shortly after SWIFT caved to US pressure and defied the EU announcing it would cut off a selection of Iranian banks, on Monday, the US Treasury said the Iranian Central Bank has been officially cut off the SWIFT financial messaging system. The disconnection, which comes at a time when Iran's economy is reeling and its currency is tumbling as a result of restricted oil exports (albeit offset by numerous temporary waivers for top Iranian oil clients), will made it far more difficult for the Islamic Republic to settle import and export bills.

Treasury Secretary Steven Mnuchin said that the move is “the right decision to protect the integrity of the international financial system", and comes after several days planning by SWIFT.

As previously discussed, SWIFT said it would begin cutting off access to several unspecified Iranian banks. More than 70 Iranian and Iranian-linked financial institutions were sanctioned, including a host of banks that allegedly provided services to Hamas and Hezbollah, and others that provided services to the Iranian armed forces.​

While the US could not directly force SWIFT to cut off Iranian banks, US Secretary of State Mike Pompeo had warned that penalties would be applied to SWIFT and any other firms that refused to comply with the latest sanctions, effectively forcing SWIFT to pick between compliance with US demands or angering top EU officials. It picked the former.
https://www.zerohedge.com/sites/default/files/inline-images/iran atm line.jpg?itok=BMnYCcV9
iran%20atm%20line.jpg


​

An allegedly "neutral" entity, SWIFT had found itself torn between a US-EU diplomatic row as of late. Scrambling to save the 2015 Joint Comprehensive Plan of Action (JCPOA), or Iran deal, EU leaders enacted a ‘blocking’ law in August, prohibiting firms operating in the bloc from complying with the US sanctions. Ironically, in siding with Washington, SWIFT, which is based outside Brussels, may face penalties in Europe.​

To overcome what is de facto US veto power on global money transfers, European leaders are planning on introducing an alternative system to ensure that payments to and from Iran can be processed. However, as Reuters reported last week, such a system will not be ready until some time in 2019, prompting Iran’s deputy foreign minister Kazem Sajjadpou to express frustration last week with the delay, saying “what is lacking is both speed and efficiency.”​

Meanwhile, on Sunday PressTV reported that over the weekend, Iran went ahead with a second public sale of its light crude oil to international clients through its Energy Bourse in a policy meant to dodge US sanctions and sell the strategic fuel to direct buyers. ​



kharg%20oil%20terminal.jpg


The National Iranian Oil Company (NIOC) had put 700,000 barrels of light oil up for grabs at a proposed price of $65.22 per barrel - $5 below the first sale that was held last week. The auction started at 14:30 Tehran’s local time (11:00 GMT) on Sunday, but finished in less than an hour according to a report by the Energy Bourse published at 15:17 local time. The oil that had been put on sale was sold out in three cargos: two at 245,000 barrels and one at 210,000 barrels.

SWIFT Cuts Off Iran Central Bank As Tehran Sells 700,000 Barrels To Anonymous Direct Buyers
 
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