Iran, EU to set up trade mechanism

The EU, Russia and China have agreed to set up a “special vehicle” to trade with Iran after the USA reimposes sanctions in November, international media reported on Tuesday.

“Mindful of the urgency and the need for tangible results, the participants welcomed practical proposals to maintain and develop payment channels, notably the initiative to establish a special purpose vehicle (SPV) to facilitate payments related to Iran’s exports, including oil,” read a joint statement by Britain, China, France, Germany, Russia and the EU, cited by Deutsche Welle.

The news came as trader Vitol announced that it would cease business with Iran after the US sanctions come into effect, and as oil prices continued to rise after <a href=’https://staging.theenergyyear.com/companies-institutions/opec/’>OPEC and Russia on Sunday refused to increase output to compensate for the decreasing Iranian exports.

“It is now increasingly evident, that in the face of producers reluctant to raise output, the market will be confronted with supply gaps in the next three-six months that it will need to resolve through higher oil prices,” Harry Tchilinguirian of BNP Paribas told Reuters.

In other energy news from Iran, Tehran plans new power links with Azerbaijan and Georgia, the Islamic Republic News Agency reported on Tuesday.