Iran reiterated its interest in trading oil with Russia, with Moscow proposing a "trade cooperation," state television news agency iribnews.ir reported Sunday, citing Central Bank of Iran Governor Abdolnasser Hemmati.
Iran and Russia already have a deal whereby Iran sells 100,000 b/d of crude oil to Russia and receives 50% of the value in cash and 50% in equipment.
According to Interfax, Russian Deputy Foreign Minister Sergei Ryabkov said Friday that Moscow was willing to step in and help Iran with its blocked oil sales due to US sanctions.
The comments followed a meeting last week between Iranian oil minister Bijan Zanganeh and his Russian counterpart Alexander Novak in Tehran.
Hemmati indicated that Iran has lost hope in using INSTEX, a European-established trade channel that promised a non-cash, non-dollar oil trade with Iran, among other commodities.
"INSTEX is a contract, whereby we and Europeans would export things to each other," Hemmati said. "Supposedly, we export oil to them, and instead we receive credit lines (for imports of goods)... but as long as this exchange has not started, it is useless."
Iran based its budget of the current year 2019-2020 on selling 1-1.5 million b/d of oil at $55/b, months before the US ended waivers for eight countries to keep buying Iranian crude.
Mohammad Hosseini, a member of parliament's budget, planning and accounting committee, said Sunday that the government will see a 500-600 trillion rial ($11.904 billion to $14.285 billion) budget deficit because of the US sanctions, the assembly's news service icana.ir reported.
Iran's government has counted on $21 billion from oil sales in the current Iranian year that ends March 19, 2020.
Hemmati said Iran plans to increase oil exports to counter a cash shortage.
"It is natural that the [expected] oil income decrease affects the country's budget... in the first step our goal is to increase oil exports in unconventional ways," the senior banking official said.
It is not known whether Russia would help Iran to export its oil to Europe in a swap or another way.
