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Greece to Repay Oil Debt To Iran In Two Years

Oil tanker

Greece will repay all its oil debts to Iran under a two-year instalment plan, Iran’s Mehr News Agency reported on Friday, quoting deputy oil minister for international affairs, Amir Hossein Zamaninia, as saying.

Zamaninia has previously said that Greek refiner Hellenic Petroleum owed Iran around US$979 million (900 million euro), the Iranian news agency says.

Iran is currently shipping on average 60,000 barrels per day to Greece, according to the deputy oil minister.

It was Greece, with Hellenic Petroleum, that was the first EU country to return to buying Iran’s oil right after the international sanctions against Iran were lifted in January of this year. At that time, Greece’s biggest oil refiner said that it had reached a long-term agreement with the National Iranian Oil Company (NIOC) that includes the immediate start of crude oil deliveries, and settlement of financial liabilities, which originated from the international sanctions imposed on Iran.

Before the sanctions, Hellenic Petroleum was one of Iran’s significant buyers of crude and imported around 20 percent of its oil needs from the Islamic Republic. Hellenic Petroleum owns three of Greece’s four oil refineries.

At the time the agreement with NIOC was announced, Hellenic Petroleum was thought to owe Iran some US$550-600 million for oil it had imported, which it was unable to pay under the international embargo.

Since the international sanctions were lifted, Iran has been increasingly ramping up its crude oil output to try to regain market shares it had lost with the embargo. According to NIOC’s managing director Ali Kardor, the country reached the 4-million-bpd output mark earlier this month.

However, Iran has joined Iraq and Venezuela in questioning the way OPEC calculates production levels. Earlier this week Iran said that it is actually producing 300,000 barrels per day more than OPEC’s secondary sources estimates. The dispute over OPEC data to use as baseline for production may derail a possible deal to limit production within the organization, when member states meet to discuss the specifics of the target output range of 32.5 million bpd to 33 million bpd.

By Tsvetana Paraskova for Oilprice.com

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