Iranian oil bourse
Encyclopedia
The Iranian Oil Bourse International Oil Bourse, Iran Petroleum Exchange Kish Exchange or Oil Bourse in Kish (IOB; the official English language name is unclear) is a commodity exchange
which opened on February 17, 2008. It was created by cooperation between Iran
ian ministries, the Iran Mercantile Exchange
and other state and private institutions. The IOB is intended as an oil bourse
for petroleum
, petrochemical
s and gas
in various currencies other than the United States dollar
, primarily the euro
and Iranian rial
and a basket of other major (non-US) currencies. The geographical location is at the Persian Gulf
island of Kish
which is designated by Iran as a free trade zone
.
During 2007, Iran asked its petroleum customers to pay in non US dollar currencies. By December 8, 2007, Iran reported to have converted all of its oil export payments to non-dollar currencies.
The Kish Bourse was officially opened in a videoconference ceremony on February 17, 2008, despite last minute disruptions to the internet services to the Persian Gulf regions. Currently the Kish Bourse is only trading in oil-derived products, generally those used as feedstock for the plastics and pharmaceutical industries. However, officially published statements by Iranian oil minister Gholamhossein Nozari indicate that the second phase, to establish trading in crude oil directly, which has been suggested might one day perhaps create a "Caspian Crude" benchmark price analogous to Brent Crude
or WTI
will only be started after the Bourse has demonstrated a reasonable period of trouble-free running.
's West Texas Intermediate
crude (WTI), North Sea
Brent Crude
, and the UAE
Dubai Crude
. The two major oil bourse
s are the New York Mercantile Exchange
(NYMEX) in New York City
and the IntercontinentalExchange
(ICE) in London
& Atlanta. As the Oil Bourse in Kish is developed through successive stages, the plan is to establish a Petrobourse as a fourth oil market, denominated by the Iranian rial
, the euro
and other major currencies.
Iran
sits on some of the largest oil and gas reserves in the world. The bourse will offer 40 kinds of oil products. Iran produces over 25 percent of the total output of petrochemical products
in the Middle East. At least 30 domestic companies and 20 foreign firms are active in the oil and petrochemical industries on Kish Island.
As of 2009, the Oil Bourse was a spot market
for petrochemical products
mainly, with plans to introduce sharia
-compliant futures contracts for crude oil and petrochemicals in the future, during the second phase. Trading takes place through licensed private brokers registered with the Securities and Exchange Organization of Iran. Any company, domestic or foreign, can list their products on the exchange for as long as they meet the listing criteria.
Global standards for Islamic derivatives
were set in 2010. The “Hedging Master Agreement” provides a structure under which institutions can trade derivatives such as profit-rate and currency swap
s.
(TSE), the Wimpole Consortium and a private staff fund for retired petroleum workers were to form a consortium developing the exchange.
January 2006 Chris Cook of the Wimpole Consortium referred to delays in the process due to the election to the presidency
of Mahmoud Ahmadinejad and subsequent difficulty in appointing a new oil minister acceptable both to the president and parliament.
March 2006 the Petroleum Minister of Iran, Kazem Vaziri Hamaneh, announced that due to "technical glitches", the Bourse launch was postponed, with no new date set. However, as of April 26 Iran had restarted its move to open the oil market, and Kazem announced the bourse was set to open the first week of May.
May 2006 Minister of Economic Affairs and Finance Davoud Danesh-Jafari
said the Oil Ministry has a two-month deadline for presenting the Articles of Association
of the Iranian Oil Bourse. Danesh-Jafari said that the euro
had not yet been finalized as the legal tender of transactions in the oil bourse, and the final decision about that depends upon the Oil Ministry’s proposed IOB Articles of Association.
July 2006 a building has been purchased and the projected opening date was originally slated for September 2006. On September 15, Oil Minister Kazem Vaziri-Hamaneh stated that all preparatory requirements had been arranged for launching the oil stock market in the country. However, the launch has still not occurred.
December 2006 Bloomberg cited two Iranian newspapers reporting Iran's Minister of Economy Davoud Danesh-Ja'fari Iran as wanting to cut US dollar based transactions to a minimum.
March 2007 Tehran based Press TV
reported that the Iranian Embassy in Baghdad announced a shift of its major currency from dollars to euros. Iraqis traveling to Iran will pay for a visa in euros in line with other Iran Embassy locations.
March 2007 The New York Times reported that China's state-run Zhuhai Zhenrong Trading, the biggest buyer of Iranian crude worldwide, began paying for its oil in euros late last year. Iranian officials have said for months that more than half the OPEC member's customers switched their payment currency away from the dollar as Tehran seeks to diversify its reserves, but news of the Zhenrong change is the first outside confirmation. Japan has also announced that it would be willing to switch to Yen from US Dollars. Iran's central banker
announced in March 2007 that Iran had cut its holding of U.S.-dollar assets to around 20% of its foreign reserves in response to U.S. hostility.
July 2007 Iran asked Japan to pay for its oil purchases in Japanese Yen.
September 2007 Japan's Nippon Oil has agreed to buy Iranian oil using yen.
December 2007 Iran stops accepting U.S. dollars for oil.
January 2008 Iran's Finance Minister Davoud Danesh-Jafari told reporters that the bourse will be opened during the anniversary of the Islamic Revolution (February 1-11).
February 2008 On February 4, the Iranian Cabinet
approved the creation of the oil bourse in two stages - first a raw oil exchange and secondly an oil byproducts exchange. The Ministry of Finance and Economics, the Oil Ministry
, the Ministry of Foreign Affairs
, and the Central Bank of Iran are required to create a workgroup to coordinate the project, and the Iran Commodities Bourse Company is given the task of carrying out the project. The communique from the Cabinet states that the "Ministry of Finance and Economics Affairs
is required to take measures in making the petrochemical byproducts bourse operational by the end of February 2008."
attended by ministers of oil, finance and economic affairs as well as chairman of Iran's Stock Exchange
and a number of other officials and financial experts.
The transactions will be made in Iranian rial
, yen, euro
and other major currencies. The Iranian Oil Bourse will probably accept Russian ruble
as well.
The first transaction of the IOB took place at 9:30 the following morning, when 2200 tonne
s of low density polyethylene
(LD-PE), held in 100 tonne cases, were traded.
November 2008: According to Chairman of Board of Directors for Iranian Oil Bourse Mehdi Karbasian ever since the launch of the first phase of the bourse, transactions worth over $1.5 billion have been made on different oil and petrochemical products.
December 2008: Iran is permitting local private firms and not just foreign companies to enter the trade in Iranian crude. One organization that could now trade was Bonyad-e Mostazafen va Janbazan
- a body that helps the underprivileged and war disabled, or a charitable trust with business interests.
October 2009: IRNA reported that "National Petrochemical Company
's Managing Director Adel Nejad-Salim said in the opening ceremony that all petrochemical products will be gradually offered on the market."
In the first phase, only petrochemical products such as polyethylene and methanol were traded on a spot basis and in Iranian Rial
. However, with the completion of the second phase, crude and by-products of oil can also be traded on the exchange in both Iranian Rial
and Euro
.
April 2011: Iran inaugurated the third phase of oil bourse with vast opportunities for foreign companies. All types of contracts in the oil bourse will be based upon global standards of purchase and sale and in accordance with Islamic rules.
August 2011: A shipment of 500,000 barrels of heavy crude oil were offered at the Kish Commodity Exchange on 18 August 2011 and were traded at USD 105.49 per barrel. The crude consignment was traded without any discount or additional premium.
(NIPC), Abdolhossein Bayat, Iran
, Saudi Arabia
, UAE, Russia
, Qatar
, and Turkey
are potential members of PECF.
Videos
Commodities exchange
A commodities exchange is an exchange where various commodities and derivatives products are traded. Most commodity markets across the world trade in agricultural products and other raw materials and contracts based on them...
which opened on February 17, 2008. It was created by cooperation between Iran
Iran
Iran , officially the Islamic Republic of Iran , is a country in Southern and Western Asia. The name "Iran" has been in use natively since the Sassanian era and came into use internationally in 1935, before which the country was known to the Western world as Persia...
ian ministries, the Iran Mercantile Exchange
Iran Mercantile Exchange
Iran Mercantile Exchange is a commodity exchange located in Tehran, Iran. It was founded in 2006. IME trades in agricultural, industrial and petrochemical products in the spot and futures markets...
and other state and private institutions. The IOB is intended as an oil bourse
Oil bourse
An oil bourse is a commodities exchange where energy commodities such as crude oil and natural gas are traded. Examples include the New York Mercantile Exchange and the Intercontinental Exchange....
for petroleum
Petroleum
Petroleum or crude oil is a naturally occurring, flammable liquid consisting of a complex mixture of hydrocarbons of various molecular weights and other liquid organic compounds, that are found in geologic formations beneath the Earth's surface. Petroleum is recovered mostly through oil drilling...
, petrochemical
Petrochemical
Petrochemicals are chemical products derived from petroleum. Some chemical compounds made from petroleum are also obtained from other fossil fuels, such as coal or natural gas, or renewable sources such as corn or sugar cane....
s and gas
Gas
Gas is one of the three classical states of matter . Near absolute zero, a substance exists as a solid. As heat is added to this substance it melts into a liquid at its melting point , boils into a gas at its boiling point, and if heated high enough would enter a plasma state in which the electrons...
in various currencies other than the United States dollar
United States dollar
The United States dollar , also referred to as the American dollar, is the official currency of the United States of America. It is divided into 100 smaller units called cents or pennies....
, primarily the euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
and Iranian rial
Iranian rial
The rial is the currency of Iran. It is subdivided into 100 dinar but, because of the very low current value of the rial, no fraction of the rial is used in accounting....
and a basket of other major (non-US) currencies. The geographical location is at the Persian Gulf
Persian Gulf
The Persian Gulf, in Southwest Asia, is an extension of the Indian Ocean located between Iran and the Arabian Peninsula.The Persian Gulf was the focus of the 1980–1988 Iran-Iraq War, in which each side attacked the other's oil tankers...
island of Kish
Kish, Iran
Kish is a resort island in the Persian Gulf. It is part of the Hormozgān Province of Iran. Due to its free trade zone status it is touted as a consumer's paradise, with numerous malls, shopping centres, tourist attractions, and resort hotels. It has an estimated population of 20,000 residents and...
which is designated by Iran as a free trade zone
Free trade zone
A free trade zone or export processing zone , also called foreign-trade zone, formerly free port is an area within which goods may be landed, handled, manufactured or reconfigured, and reexported without the intervention of the customs authorities...
.
During 2007, Iran asked its petroleum customers to pay in non US dollar currencies. By December 8, 2007, Iran reported to have converted all of its oil export payments to non-dollar currencies.
The Kish Bourse was officially opened in a videoconference ceremony on February 17, 2008, despite last minute disruptions to the internet services to the Persian Gulf regions. Currently the Kish Bourse is only trading in oil-derived products, generally those used as feedstock for the plastics and pharmaceutical industries. However, officially published statements by Iranian oil minister Gholamhossein Nozari indicate that the second phase, to establish trading in crude oil directly, which has been suggested might one day perhaps create a "Caspian Crude" benchmark price analogous to Brent Crude
Brent Crude
Brent Crude is the biggest of the many major classifications of crude oil consisting of Brent Crude, Brent Sweet Light Crude, Oseberg, Ekofisk, and Forties . Brent Crude is sourced from the North Sea. The Brent Crude oil marker is also known as Brent Blend, London Brent and Brent petroleum...
or WTI
West Texas Intermediate
West Texas Intermediate , also known as Texas light sweet, is a grade of crude oil used as a benchmark in oil pricing. It is a light and sweet crude oil...
will only be started after the Bourse has demonstrated a reasonable period of trouble-free running.
Background
The three current oil markers are all US dollar denominated: North AmericaNorth America
North America is a continent wholly within the Northern Hemisphere and almost wholly within the Western Hemisphere. It is also considered a northern subcontinent of the Americas...
's West Texas Intermediate
West Texas Intermediate
West Texas Intermediate , also known as Texas light sweet, is a grade of crude oil used as a benchmark in oil pricing. It is a light and sweet crude oil...
crude (WTI), North Sea
North Sea
In the southwest, beyond the Straits of Dover, the North Sea becomes the English Channel connecting to the Atlantic Ocean. In the east, it connects to the Baltic Sea via the Skagerrak and Kattegat, narrow straits that separate Denmark from Norway and Sweden respectively...
Brent Crude
Brent Crude
Brent Crude is the biggest of the many major classifications of crude oil consisting of Brent Crude, Brent Sweet Light Crude, Oseberg, Ekofisk, and Forties . Brent Crude is sourced from the North Sea. The Brent Crude oil marker is also known as Brent Blend, London Brent and Brent petroleum...
, and the UAE
Dubai Mercantile Exchange
The Dubai Mercantile Exchange is a commodity exchange based in Dubai currently listing its flagship futures contract, DME Oman Crude Oil Futures Contract...
Dubai Crude
Dubai Crude
Dubai Crude is a light sour crude oil extracted from Dubai. Dubai Crude is used as a price benchmark or oil marker because it is one of only a few Persian Gulf crude oils available immediately. The other two main oil markers are Brent Crude and West Texas Intermediate.Dubai Crude is generally used...
. The two major oil bourse
Oil bourse
An oil bourse is a commodities exchange where energy commodities such as crude oil and natural gas are traded. Examples include the New York Mercantile Exchange and the Intercontinental Exchange....
s are the New York Mercantile Exchange
New York Mercantile Exchange
The New York Mercantile Exchange is the world's largest physical commodity futures exchange. It is located at One North End Avenue in the World Financial Center in the Battery Park City section of Manhattan, New York City...
(NYMEX) in New York City
New York City
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...
and the IntercontinentalExchange
IntercontinentalExchange
IntercontinentalExchange, Inc., known as ICE, is an American financial company that operates Internet-based marketplaces which trade futures and over-the-counter energy and commodity contracts as well as derivative financial products...
(ICE) in London
International Petroleum Exchange
The International Petroleum Exchange, based in London, was one of the world's largest energy futures and options exchanges. Its flagship commodity, Brent Crude was a world benchmark for oil prices, but the exchange also handled futures contracts and options on fuel oil, natural gas, electricity ,...
& Atlanta. As the Oil Bourse in Kish is developed through successive stages, the plan is to establish a Petrobourse as a fourth oil market, denominated by the Iranian rial
Iranian rial
The rial is the currency of Iran. It is subdivided into 100 dinar but, because of the very low current value of the rial, no fraction of the rial is used in accounting....
, the euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
and other major currencies.
Iran
Iran
Iran , officially the Islamic Republic of Iran , is a country in Southern and Western Asia. The name "Iran" has been in use natively since the Sassanian era and came into use internationally in 1935, before which the country was known to the Western world as Persia...
sits on some of the largest oil and gas reserves in the world. The bourse will offer 40 kinds of oil products. Iran produces over 25 percent of the total output of petrochemical products
National Iranian Petrochemical Company
The National Iranian Petrochemical Company , a subsidiary to the Iranian Petroleum Ministry, is owned by the government of the Islamic Republic of Iran. It is responsible for the development and operation of the country's petrochemical sector. Founded in 1964, NIPC began its activities by operating...
in the Middle East. At least 30 domestic companies and 20 foreign firms are active in the oil and petrochemical industries on Kish Island.
Operations
At the time of the Oil Bourse's opening on Kish, the Director of the Kish Stock Exchange, Hossein Allahdadi, said that there "are no limitations imposed on transactions by foreign shareholders at the Oil Bourse in Kish".As of 2009, the Oil Bourse was a spot market
Spot market
The spot market or cash market is a public financial market, in which financial instruments or commodities are traded for immediate delivery. It contrasts with a futures market in which delivery is due at a later date...
for petrochemical products
National Iranian Petrochemical Company
The National Iranian Petrochemical Company , a subsidiary to the Iranian Petroleum Ministry, is owned by the government of the Islamic Republic of Iran. It is responsible for the development and operation of the country's petrochemical sector. Founded in 1964, NIPC began its activities by operating...
mainly, with plans to introduce sharia
Islamic banking
Islamic banking is banking or banking activity that is consistent with the principles of Islamic law and its practical application through the development of Islamic economics. Sharia prohibits the fixed or floating payment or acceptance of specific interest or fees for loans of money...
-compliant futures contracts for crude oil and petrochemicals in the future, during the second phase. Trading takes place through licensed private brokers registered with the Securities and Exchange Organization of Iran. Any company, domestic or foreign, can list their products on the exchange for as long as they meet the listing criteria.
Global standards for Islamic derivatives
Derivative (finance)
A derivative instrument is a contract between two parties that specifies conditions—in particular, dates and the resulting values of the underlying variables—under which payments, or payoffs, are to be made between the parties.Under U.S...
were set in 2010. The “Hedging Master Agreement” provides a structure under which institutions can trade derivatives such as profit-rate and currency swap
Currency swap
A currency swap is a foreign-exchange agreement between two parties to exchange aspects of a loan in one currency for equivalent aspects of an equal in net present value loan in another currency; see foreign exchange derivative. Currency swaps are motivated by comparative advantage...
s.
Timeline
The Iranian oil bourse, first reported in 2005, initially had a widely publicised opening date of March 20, 2006. which is the Iranian New Year, Nauroz. According to an April 2005 report, the Tehran Stock ExchangeTehran Stock Exchange
The Tehran Stock Exchange is Iran's largest stock exchange, which first opened in 1967. The TSE is based in Tehran. As of July 2010, 337 companies with a market capitalization of US$72 billion were listed on TSE...
(TSE), the Wimpole Consortium and a private staff fund for retired petroleum workers were to form a consortium developing the exchange.
January 2006 Chris Cook of the Wimpole Consortium referred to delays in the process due to the election to the presidency
Iranian presidential election, 2005
Iran's ninth presidential election took place in two rounds, the first on June 17, 2005, the run-off on June 24. Mohammad Khatami, the previous President of Iran, stepped down on August 2, 2005, after serving his maximum two consecutive four-year terms according to the Islamic Republic's constitution...
of Mahmoud Ahmadinejad and subsequent difficulty in appointing a new oil minister acceptable both to the president and parliament.
March 2006 the Petroleum Minister of Iran, Kazem Vaziri Hamaneh, announced that due to "technical glitches", the Bourse launch was postponed, with no new date set. However, as of April 26 Iran had restarted its move to open the oil market, and Kazem announced the bourse was set to open the first week of May.
May 2006 Minister of Economic Affairs and Finance Davoud Danesh-Jafari
Davoud Danesh-Jafari
-Biography:Born in 1954 in Tehran, Danesh-Jafari graduated with Bachelor's Degree from the Kashmir University, India in Civil Engineering. He is an alumnus of National Institute of Technology Srinagar in Srinagar, India....
said the Oil Ministry has a two-month deadline for presenting the Articles of Association
Articles of Association (law)
The term articles of association of a company, or articles of incorporation, of an American or Canadian Company, are often simply referred to as articles . The Articles are a requirement for the establishment of a company under the law of India, the United Kingdom and many other countries...
of the Iranian Oil Bourse. Danesh-Jafari said that the euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
had not yet been finalized as the legal tender of transactions in the oil bourse, and the final decision about that depends upon the Oil Ministry’s proposed IOB Articles of Association.
July 2006 a building has been purchased and the projected opening date was originally slated for September 2006. On September 15, Oil Minister Kazem Vaziri-Hamaneh stated that all preparatory requirements had been arranged for launching the oil stock market in the country. However, the launch has still not occurred.
December 2006 Bloomberg cited two Iranian newspapers reporting Iran's Minister of Economy Davoud Danesh-Ja'fari Iran as wanting to cut US dollar based transactions to a minimum.
March 2007 Tehran based Press TV
Press TV
Press TV is a 24-hour English language global news network owned by the Iranian government. Its headquarters are located in Tehran, Iran, with bureaux in Beirut , Damascus , London , Seoul and Washington DC ....
reported that the Iranian Embassy in Baghdad announced a shift of its major currency from dollars to euros. Iraqis traveling to Iran will pay for a visa in euros in line with other Iran Embassy locations.
March 2007 The New York Times reported that China's state-run Zhuhai Zhenrong Trading, the biggest buyer of Iranian crude worldwide, began paying for its oil in euros late last year. Iranian officials have said for months that more than half the OPEC member's customers switched their payment currency away from the dollar as Tehran seeks to diversify its reserves, but news of the Zhenrong change is the first outside confirmation. Japan has also announced that it would be willing to switch to Yen from US Dollars. Iran's central banker
Bank Markazi Iran
The Central Bank of the Islamic Republic of Iran is the central bank of Iran. It is entirely government owned. Among its major purposes are: maintenance of the value of the national currency, balance of payments as well as facilitating trade transactions and contributing to the economic...
announced in March 2007 that Iran had cut its holding of U.S.-dollar assets to around 20% of its foreign reserves in response to U.S. hostility.
July 2007 Iran asked Japan to pay for its oil purchases in Japanese Yen.
September 2007 Japan's Nippon Oil has agreed to buy Iranian oil using yen.
December 2007 Iran stops accepting U.S. dollars for oil.
January 2008 Iran's Finance Minister Davoud Danesh-Jafari told reporters that the bourse will be opened during the anniversary of the Islamic Revolution (February 1-11).
February 2008 On February 4, the Iranian Cabinet
Cabinet (government)
A Cabinet is a body of high ranking government officials, typically representing the executive branch. It can also sometimes be referred to as the Council of Ministers, an Executive Council, or an Executive Committee.- Overview :...
approved the creation of the oil bourse in two stages - first a raw oil exchange and secondly an oil byproducts exchange. The Ministry of Finance and Economics, the Oil Ministry
Ministry of Petroleum of Iran
The Ministry of Petroleum manages the oil industry, the producer of oil and petrochemical products. MoP is in charge of all issues pertaining to exploration, extraction, exploitation, distribution and exportation of crude oil and oil products. In addition, according to the "", issuing import...
, the Ministry of Foreign Affairs
Ministry of Foreign Affairs (Iran)
The Ministry of Foreign Affairs is an Iranian government ministry. The Minister for Foreign Affairs is the Cabinet member in charge....
, and the Central Bank of Iran are required to create a workgroup to coordinate the project, and the Iran Commodities Bourse Company is given the task of carrying out the project. The communique from the Cabinet states that the "Ministry of Finance and Economics Affairs
Ministry of Economic Affairs and Finance (Iran)
The Ministry of Economic Affairs and Finances function are:*acting as the state treasury,*public finance,*economic and financial policy making,*implementing tax policies,*in charge of foreign direct investment,...
is required to take measures in making the petrochemical byproducts bourse operational by the end of February 2008."
Opening
February 17, 2008: The Iranian Oil Bourse was inaugurated in a video conference ceremony from the capital TehranTehran
Tehran , sometimes spelled Teheran, is the capital of Iran and Tehran Province. With an estimated population of 8,429,807; it is also Iran's largest urban area and city, one of the largest cities in Western Asia, and is the world's 19th largest city.In the 20th century, Tehran was subject to...
attended by ministers of oil, finance and economic affairs as well as chairman of Iran's Stock Exchange
Tehran Stock Exchange
The Tehran Stock Exchange is Iran's largest stock exchange, which first opened in 1967. The TSE is based in Tehran. As of July 2010, 337 companies with a market capitalization of US$72 billion were listed on TSE...
and a number of other officials and financial experts.
The transactions will be made in Iranian rial
Iranian rial
The rial is the currency of Iran. It is subdivided into 100 dinar but, because of the very low current value of the rial, no fraction of the rial is used in accounting....
, yen, euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
and other major currencies. The Iranian Oil Bourse will probably accept Russian ruble
Russian ruble
The ruble or rouble is the currency of the Russian Federation and the two partially recognized republics of Abkhazia and South Ossetia. Formerly, the ruble was also the currency of the Russian Empire and the Soviet Union prior to their breakups. Belarus and Transnistria also use currencies with...
as well.
The first transaction of the IOB took place at 9:30 the following morning, when 2200 tonne
Tonne
The tonne, known as the metric ton in the US , often put pleonastically as "metric tonne" to avoid confusion with ton, is a metric system unit of mass equal to 1000 kilograms. The tonne is not an International System of Units unit, but is accepted for use with the SI...
s of low density polyethylene
Low density polyethylene
Low-density polyethylene is a thermoplastic made from petroleum. It was the first grade of polyethylene, produced in 1933 by Imperial Chemical Industries using a high pressure process via free radical polymerization. Its manufacture employs the same method today. LDPE is commonly recycled and has...
(LD-PE), held in 100 tonne cases, were traded.
November 2008: According to Chairman of Board of Directors for Iranian Oil Bourse Mehdi Karbasian ever since the launch of the first phase of the bourse, transactions worth over $1.5 billion have been made on different oil and petrochemical products.
December 2008: Iran is permitting local private firms and not just foreign companies to enter the trade in Iranian crude. One organization that could now trade was Bonyad-e Mostazafen va Janbazan
Bonyad-e Mostazafen va Janbazan
The Mostazafen Foundation of Islamic Revolution formerly Bonyad-e Mostazafen va Janbazan is a charitable bonyad, or foundation, in the Islamic Republic of Iran, the second-largest commercial enterprise in Iran behind the state-owned National Iranian Oil Company and biggest holding company in the...
- a body that helps the underprivileged and war disabled, or a charitable trust with business interests.
October 2009: IRNA reported that "National Petrochemical Company
National Iranian Petrochemical Company
The National Iranian Petrochemical Company , a subsidiary to the Iranian Petroleum Ministry, is owned by the government of the Islamic Republic of Iran. It is responsible for the development and operation of the country's petrochemical sector. Founded in 1964, NIPC began its activities by operating...
's Managing Director Adel Nejad-Salim said in the opening ceremony that all petrochemical products will be gradually offered on the market."
In the first phase, only petrochemical products such as polyethylene and methanol were traded on a spot basis and in Iranian Rial
Iranian rial
The rial is the currency of Iran. It is subdivided into 100 dinar but, because of the very low current value of the rial, no fraction of the rial is used in accounting....
. However, with the completion of the second phase, crude and by-products of oil can also be traded on the exchange in both Iranian Rial
Iranian rial
The rial is the currency of Iran. It is subdivided into 100 dinar but, because of the very low current value of the rial, no fraction of the rial is used in accounting....
and Euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
.
April 2011: Iran inaugurated the third phase of oil bourse with vast opportunities for foreign companies. All types of contracts in the oil bourse will be based upon global standards of purchase and sale and in accordance with Islamic rules.
August 2011: A shipment of 500,000 barrels of heavy crude oil were offered at the Kish Commodity Exchange on 18 August 2011 and were traded at USD 105.49 per barrel. The crude consignment was traded without any discount or additional premium.
Petrochemical Exporting Countries Forum (PECF)
Iran has proposed the creation of a Petrochemical Exporting Countries Forum (PECF) which aims at financial and technological cooperation among members, as well as product pricing and policy making in production issues. According to the Managing Director of National Iranian Petrochemical CompanyNational Iranian Petrochemical Company
The National Iranian Petrochemical Company , a subsidiary to the Iranian Petroleum Ministry, is owned by the government of the Islamic Republic of Iran. It is responsible for the development and operation of the country's petrochemical sector. Founded in 1964, NIPC began its activities by operating...
(NIPC), Abdolhossein Bayat, Iran
Iran
Iran , officially the Islamic Republic of Iran , is a country in Southern and Western Asia. The name "Iran" has been in use natively since the Sassanian era and came into use internationally in 1935, before which the country was known to the Western world as Persia...
, Saudi Arabia
Saudi Arabia
The Kingdom of Saudi Arabia , commonly known in British English as Saudi Arabia and in Arabic as as-Sa‘ūdiyyah , is the largest state in Western Asia by land area, constituting the bulk of the Arabian Peninsula, and the second-largest in the Arab World...
, UAE, Russia
Russia
Russia or , officially known as both Russia and the Russian Federation , is a country in northern Eurasia. It is a federal semi-presidential republic, comprising 83 federal subjects...
, Qatar
Qatar
Qatar , also known as the State of Qatar or locally Dawlat Qaṭar, is a sovereign Arab state, located in the Middle East, occupying the small Qatar Peninsula on the northeasterly coast of the much larger Arabian Peninsula. Its sole land border is with Saudi Arabia to the south, with the rest of its...
, and Turkey
Turkey
Turkey , known officially as the Republic of Turkey , is a Eurasian country located in Western Asia and in East Thrace in Southeastern Europe...
are potential members of PECF.
2008 submarine cable disruption
It has been suggested that 2008 submarine cable disruption was connected with the launch of Iranian oil bourse and that the internet connection of Iran was being targeted to stop the launch of Iranian oil bourse.See also
- Economy of IranEconomy of IranThe economy of Iran is the eighteenth largest in the world by purchasing power parity and according to Iranian officials' claims is going to become the 12th largest by 2015. The economy of Iran is a mixed and transition economy with a large public sector and some 50% of the economy centrally planned...
- Iran Mercantile ExchangeIran Mercantile ExchangeIran Mercantile Exchange is a commodity exchange located in Tehran, Iran. It was founded in 2006. IME trades in agricultural, industrial and petrochemical products in the spot and futures markets...
- Energy in IranEnergy in IranEnergy resources in Iran consist of the third largest oil reserves and the second largest natural gas reserves in the world. Iran is in a constant battle to use its energy resources more effectively in the face of subsidization and the need for technological advances in energy exploration and...
- Petroleum industry in IranPetroleum industry in IranIn 2004 Iran produced 5.1 percent of the world’s total crude oil , which generated revenues of US$25 billion to US$30 billion and was the country’s primary source of foreign currency. At 2006 levels of production, oil proceeds represented about 18.7 percent of gross domestic product . However, the...
- Ministry of Petroleum of IranMinistry of Petroleum of IranThe Ministry of Petroleum manages the oil industry, the producer of oil and petrochemical products. MoP is in charge of all issues pertaining to exploration, extraction, exploitation, distribution and exportation of crude oil and oil products. In addition, according to the "", issuing import...
- National Iranian Petrochemical CompanyNational Iranian Petrochemical CompanyThe National Iranian Petrochemical Company , a subsidiary to the Iranian Petroleum Ministry, is owned by the government of the Islamic Republic of Iran. It is responsible for the development and operation of the country's petrochemical sector. Founded in 1964, NIPC began its activities by operating...
- PetrodollarPetrodollarA petrodollar is a United States dollar earned by a country through the sale of petroleum. The term was coined by Ibrahim Oweiss, a professor of economics at Georgetown University, in 1973...
- Petrodollar warfarePetrodollar warfareThe phrase petrodollar warfare refers to a hypothesis that one of the unknown, driving forces of United States foreign policy over recent decades has been the status of the United States dollar as the world's dominant reserve currency and as the currency in which oil is priced. The term was coined...
Literature
- Clark, William R.: "Petrodollar Warfare: Oil, Iraq and the Future of the Dollar", New Society Publishers, 2005, ISBN 0-86571-514-9
External links
- Iran Oil Bourse to deal blow to dollar, January 2008
- Hysteria Over Iran and A New Cold War with Russia: Peak Oil, Petrocurrencies, and the Emerging Multi-Polar World, December 2006
- PetroTalk Portal for petro related Articles, Discussion, Links and more
- Iran oil bourse next week, Persian Journal, April 26, 2006
- Iran takes on west's control of oil trading, The GuardianThe GuardianThe Guardian, formerly known as The Manchester Guardian , is a British national daily newspaper in the Berliner format...
- The Real Reasons Why Iran is the Next Target: The Emerging Euro-denominated International Oil Marker
- Petrodollar Warfare: Dollars, Euros and the Upcoming Iranian Oil Bourse
- The Proposed Iranian Oil Bourse
- Trading oil in euros – does it matter?
- Will the Iranian Oil Bourse Threaten the Dollar?
- The Iranian line in the sand
- Petrodollar or Petroeuro? A new source of global conflict
- The Iranian Threat: The Bomb or the Euro?
- Strange ideas about the Iranian oil bourse
- Iranian Oil Bourse opening IOB will open amid hurdles
Videos
- Iranian Oil Bourse - Part I Part II Part III (PressTV video)