Iran Asks Japan to Pay Yen for Oil

[blackcat]

Iran Asks Japan to Pay Yen for Oil, Start Immediately

http://www.bloomberg.com/apps/news?pid=206...tfXY&refer=home

By Megumi Yamanaka

July 13 (Bloomberg) -- Iran asked Japanese refiners to switch to the yen to pay for all crude oil purchases, after Iran's central bank said it is reducing holdings of the U.S. dollar.

Iran wants yen-based transactions ``for any/all of your forthcoming Iranian crude oil liftings,'' according to a letter sent to Japanese refiners that was signed by Ali A. Arshi, general manager of crude oil marketing and exports in Tehran at the National Iranian Oil Co. The request is for all shipments ``effective immediately,'' according to the letter, dated July 10 and obtained by Bloomberg News.

The yen rose on speculation for an increase in demand for the currency, the result of Japan's annual 1.24 trillion yen ($10.1 billion) of oil imports from Iran. Central bankers in Venezuela, Indonesia and the United Arab Emirates have said they will invest less of their reserves in dollar assets because of the weakening currency.

``What else can Japan do but to accept the request, once the oil producer sent its wish?'' said Hirofumi Kawachi, an analyst at Mizuho Investors Securities Co. in Tokyo. ``The tensions between the U.S. and Iran are escalating, and it's Iran's measure to hedge risk.''

A spokesman for Iran's oil ministry in Tehran said he could neither confirm nor deny that the letter had been sent. Most Japanese oil refiners have until now used U.S. dollars to pay Iran for oil, said the spokesman, who declined to be identified by name because of government policy.

Yen Advances

The yen advanced to 122.07 per dollar at 2:30 p.m. in New York, from 122.42 late yesterday.

Iran is cutting its U.S. dollar reserves to less than 20 percent of total foreign currency holdings, and will buy more euros and yen as tensions with the U.S. increase, Central Bank Governor Ebrahim Sheibany said on March 27.

The United Nations Security Council is preparing for another round of sanctions against Iran because of the nation's nuclear research.

The Islamic republic, holder of the world's second-largest oil and gas reserves, has refused to halt uranium enrichment that it says is for use in nuclear power plants to produce electricity. The U.S. says Iran seeks instead to develop an atomic bomb. Enriched uranium can be used to make nuclear fuel or build nuclear weapons.

Iran isn't alone in wanting to drop the dollar for pricing oil. Russia has been examining plans to price the Urals oil export blend in rubles to curb currency risks. The nation plans to open the Energy Stock Exchange in St. Petersburg in the first half of next year to trade oil in rubles, UBS AG reported June 14.

`New Payment Mechanism'

Iran asked the refiners to use the yen exchange rate quoted at the Bank of Tokyo Mitsubishi UFJ on the date oil cargoes are loaded. The use of yen-based letters of credit for oil ``has finally been approved'' by the Iranian central bank and the NIOC, according to the letter, titled ``New payment mechanism for Iranian Crude Oil Cargoes.''

Japan imported 1.59 million kiloliters of Iranian crude oil in May, the least since June 2006, according to government data.

Only Saudi Arabia and the United Arab Emirates are larger oil suppliers to Japan than Iran.

To contact the reporter on this story: Megumi Yamanaka in Tokyo at myamanaka@bloomberg.net .
Last Updated: July 13, 2007 14:33 EDT

[karlos]

Well this is good news and bad news.
It is good news because the dollar is dropping like a stone on foreign exchanges and is the beginning of the end for the US economy. China owns more dollars than the USA itself. at some point all central banks will start to use the EURO as the main reserve currency. For some reason i could never understand the whole world but buys T Bonds which are a completely worthless investment which pays very little interst and never appreciates in value. The gulf arabs will continue to prop up the dollar but at some point they will run out of money to do this.

Iraq also starting selling it's oil for euros, just before they were attacked.
This means it is almost 100% certain Iran will be attacked now either by the USA or it's enforcer Israel. So this is bad news for the world because world war 3 might be about to kick off. when Iran is attacked it is certain that it will target US allies in the area such as the gulf arabs.
Iran cannot match the military might of the uSA.
But it has plenty of time to prepare and has a large army and manufactures it's own weapons. It also has the whole of the Iraqi air force and advanced missiles. so it will hit US bases in the arab countries and attack US ships in the gulf and Indian ocean. It can also attack us bases in Iraq. So although many thousands of Iranian civilians will be massacred by the inevitable carpet bombing US interest will be hurt too.

Imagine a nation - the USA constantly attacking and killing people all over the world for what - for the money every time.
When the USA starts bombing Iran you will see immediately the Dollar will rise on the markets. Because ther is always this tradition of a flight to quality every time war breaks out. So war is more inevitable than ever before.

[James C]

[acrobat74]

This could be really, really serious.

A couple links, couldn't get the one above to work:

http://www.bloomberg.com/apps/news?pid=20601087&sid=aLaColVYu5LA&refer =home

http://business.timesonline.co.uk/tol/business/industry_sectors/natura l_resources/article2070938.ece


Another angle:

The Fed has stopped publishing the M3 data on the US currency supply.

In other words, outside investors in US bonds have no way of knowing what the real US inflation is, and hence what rate of return to demand for their investment.

The official inflation measures seem to be doctored, as the Fed routinely engages in either substituting one good for another or making up the price altogether (hedonic adjustment).

http://www.shadowstats.com/cgi-bin/sgs?

http://goldsilver.com/the_dow_is_crashing.php

Obviously, this can't go on indefinitely.


One more US carrier heading to the Gulf:

http://www.forbes.com/business/feeds/afx/2007/07/10/afx3898491.html

[acrobat74]

[QuitTheirClogs]

Project Censored 2004: U.S. Dollar vs. the Euro: Another Reason for the Invasion of Iraq

In November 2000, Iraq became the first OPEC nation to begin selling its oil for Euros. Since then, the value of the Euro has increased 17%, and the dollar has begun to decline. One important reason for the invasion and installation of a U.S. dominated government in Iraq was to force the country back to the dollar. Another reason for the invasion is to dissuade further OPEC momentum toward the Euro, especially from Iran- the second largest OPEC producer, who was actively discussing a switch to Euros for its oil exports.

http://www.projectcensored.org/publications/2004/19.html

[karlos]

Link



Link


Well the other hedge is that the plunging dollar gets abolished and replaced by the AMERO
No need for more invasions?
Either way the US dollar is

[Disco_Destroyer]

It is my view that Britain together with USA and probably backed by Europe are bullying everyone just like under the Empire!
and the Threats don't stop at small nations they go right upto superpowers like Russia and China.
http://blog.myspace.com/index.cfm?fuseaction=blog.view&friendID=276589 26&blogID=288275663

Russia has also recieved threats over its Natural Resources especially Gas in recent years and also remember the missile shield! China has constantly been threatened over keeping the Yen low and cheap export goods! Both are constantly in the press over poor human rights record, does anyone know if they truly are worse than us in the West or is it propaganda??
I also feel for sure they will back Iran as our bullies are trying to take too much, infact I do believe Russia wanted to help Iraq also. As they lost out on alot with that one!