Iran sees Greece as conduit for re-entering Europe's oil market

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January 22 2016
Iran sees Greece as conduit for re-entering Europe's oil market

Iran believes Greece can be a conduit for re-entering Europe's oil market following the lifting of international sanctions, Greece's energy minister said on Friday after meeting Iran's deputy oil minister in Athens.

Panos Skourletis said he had held talks with Amir Hossein Zamaninia about Greece restarting oil purchases from Iran.

Hellenic Petroleum (HEPr.AT), Greece's biggest oil refiner, was a major buyer of Iranian crude, which accounted for about 20 percent of the southeast European country's annual crude oil imports before sanctions were imposed on Tehran in 2011.

"They (Iran) are positively disposed towards Greece and think that Greece can be the European conduit for them to re-enter the market," Skourletis told Reuters, saying the two countries had traditionally enjoyed close relations.

The two ministers also attended wider talks between officials from Hellenic Petroleum and the National Iranian Oil Company (NIOC) on Friday, a meeting whose arrangement was reported by Reuters on Jan. 18.

Hellenic Petroleum is estimated to owe Iran around $550-600 million for oil it bought before the sanctions but was unable to pay for when the international embargo was imposed.

Skourletis said the two sides agreed Hellenic Petroleum could settle its debt now the sanctions were easing, and was optimistic a mutually acceptable deal could be reached.

"They said that the debt (settlement) can open the way so that our cooperation is boosted," he said, adding Greek Prime Minister Alexis Tsipras was due to visit Iran early next month.

Iran used to sell as much as 800,000 barrels per day (bpd) to European refiners in Italy, Spain and Greece before the sanctions over its nuclear program were imposed.

Tehran ordered a 500,000-bpd increase in its oil output, of which 200,000 bpd will go to Europe, after the sanctions were lifted on Saturday.

But European companies and trading houses are not rushing to buy the oil because of legal uncertainties over the lifting of sanctions that are likely to take weeks to clarify.