UNITED24 - Make a charitable donation in support of Ukraine!

Weapons of Mass Destruction (WMD)

Iran Press TV

Iran official rejects Iraqi gas payment in dinar

Iran Press TV

Wed Nov 21, 2018 11:47AM

Iran's Deputy Minister of Petroleum Amir Hossein Zamaninia says Iraq has to pay in euros for the gas imported from Iran, dismissing the use of the Iraqi dinar for the payment.

"The National Iranian Gas Company does not agree that the payment for exports of gas to Iraq should be made in dinars because it should be made in euros, according to the contract," ISNA news agency quoted him as saying.

His remarks came after Iranian Ambassador to Baghdad Iraj Masjedi told Fars news agency that Tehran and Baghdad were considering using the Iraqi dinar in their transactions instead of the US dollar.

Iraq heavily depends on Iranian natural gas imports for electricity generation. Basra in southern Iraq was hit by violent protests which spread to other cities this summer, partly because of a halt of Iranian electricity exports.

Iran's gas supply to Baghdad began last June at a rate of 7 million cubic meters per day. It will increase to 35 million cubic meters daily, according to the terms of their agreement.

A separate pipeline is about to take Iranian gas to the Iraqi city of Basra in the south.

Head of Iraqi Chambers of Commerce Jafar Rasul Hamdani said this month that Iran's gas and electricity exports to Iraq rose 40 percent in the first six months of the current year from the same period a year ago.

Iraq also rejected a US deadline to stop importing Iranian gas, warning that any halt to the supplies would create a real power crisis which sparked several days of unrest in Basra and elsewhere this summer.

"Stopping Iranian gas after the deadline will create a real power crisis. We need more time … the Americans are completely aware of how desperately we need Iranian gas," an Iraqi official told Reuters news agency.

Trade between Iran and Iraq stands at $12 billion, but Baghdad is reportedly under pressure from the United States to stop business dealings with Tehran.

Iran is currently Iraq's top trade partner, having sharply increased their trade exchanges in recent months despite US sanctions on the Islamic Republic.

Masjedi said the two neighbors plan to raise their trade to $20 billion a year.

"The Iraqis need Iran's natural gas, electricity, food items and industrial materials. If these exports are stopped, there will be problems not only for Iran but also for the Iraqis," he added.

Join the GlobalSecurity.org mailing list