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Iran, India Ditch Dollar In Oil Trading To Counter ‘Bullying’ US Sanctions

Iran, India Ditch Dollar In Oil Trading To Counter ‘Bullying’ US Sanctions thumbnail

In an effort to circumvent US-imposed sanctions, India and Iran have reportedly ditched the US dollar and are trading oil in rupees. The reason becomes clear after considering the dynamics at play in the region.

In mid-February last year, Iranian President Hassan Rouhani visited India, and the two countries signed nine agreements signalling a strengthening of ties. Indian Prime Minister Narendra Modi appeared to celebrate the growing relationship, stating that it was “a matter of great pleasure” for India that an Iranian president came to India “after a gap of 10 years.”

Fast-forward a few months later, and then-UN ambassador Nikki Haley was bluntly telling India that they should rethink their relationship with Tehran.

Donald Trump’s decision to rip up the Joint Comprehensive Plan of Action (JCPOA) last year, also known as the Iranian nuclear accord, was a particularly significant blow to Iran-India relations. At the time the JCPOA was formulated, Indian officials believed the deal to be the “best deal available.” After the JCPOA’s implementation in 2016, exports of Iranian oil to India increased by more than 110 percent.

Maybe the issue isn’t always that Washington wants to contain its rivals in the Middle East and Asia, but perhaps there is a chance that it also wants to keep a lid on its so-called allies as well. Right now, India is the third largest oil consumer in the world, and is expected to become the largest by the year 2040. As its domestic reserves are not meeting the needs of its rapidly expanding economy, India has been importing 80 percent of its oil supply from overseas, including and especially Iran.

Prior to Washington’s Iran-sanctions regime, Iran was India’s third largest supplier of crude oil (it is now about sixth place). It is no surprise therefore, that India’s Foreign Ministry spokesperson responded by saying that Haley had “her views, and our views on Iran are very clear.”He also warned that India would “take all necessary steps, including engagement with relevant stakeholders to ensure our energy security.”

It does seem like the days of foreign states being bullied into adopting a dangerous foreign policy are over. If Washington has any doubt about this, they need only turn to this exclusive Reuters report which revealed that India had begun paying Iran for its oil in rupees, according to a senior bank official, under the guise of a six-month waiver which was given to seven other countries (including China). According to the report, in a previous round of US-imposed sanctions, India settled approximately half of oil payments in rupees and the remainder in euros. However, this time around, all payments are to be made in rupees.

Furthermore, the agreement, worth $1.5 billion, reportedly hands Iran a tax break of $637 million. For its part, Iran will use its rupee supply to fund its imports of pharmaceuticals and other items from India, invest in Indian businesses and pay for Iranian missions and students in India.

Prior to this arrangement, US-led sanctions continued to decimate Iran’s ability to trade freely with its partner. Oilprice explains that in December, Indian oil imports from Iran plunged by 41 percent to just over 300,000 barrels per day (bpd). This is effectively the amount allowed under Washington’s waiver.

Insurance companies are becoming increasingly unwilling to engage in transactions involving Iran, due to the risk that sanctions attract. However, according to a separate Reuters report, Russian and Chinese shipping companies had been pitching to facilitate India-Iran trade.

It seems to me that if enough countries continue to pull together to override Washington’s sanctions, they will at some point be rendered completely ineffective. It also seems as though Washington is pushing these countries to work more closely together, whereas these countries may have been freer to explore their differences and their disagreements had they been left to their own devices.

The blunt truth is that India and Iran have too much in common for India to submit fully to Washington’s strategy of global bullying. There is also a lot of things that Iran can give India which the United States cannot, and not just free shipping, insurance and extended credit. As the Diplomat explains, India and Iran both share an interest in combating Sunni-backed extremism, especially in Pakistan and Afghanistan. They both have an interest in doing what they can to outmanoeuvre China in certain aspects.

In February last year, the two nations came to an agreement involving a lease between Iran’s Port and Maritime Organization and India Ports Global Limited, which allowed India to run part of Chabahar Port for 18 months.

The two countries released a joint statement at the time, describing the port as a “golden gateway” that will help the two countries in reaching out to Afghanistan and Central Asia. This gateway is so golden, it seems, that India has already committed over $500 million to the project, with indications that it could become a multi-billion dollar project.

The idea of the project is to improve “energy, security and regional connectivity” to reach Afghanistan. In reality, it allowsIndia to ship supplies to Afghanistan while bypassing Pakistan. Chabahar Port in southeastern Iran is approximately 90km (56 miles) west of the Pakistani port of Gwadar, the epicentre of an enormous Chinese infrastructure program in Pakistan. This is the same location where it was rumored that China was establishing a military base.

In other words, if India is forced to join the US effort to completely isolate Iran on the world stage, it may risk losing out on a significant chunk of the regional fruits to Pakistan and China. This is not conjecture; Iran has already reached out to Pakistan and China to participate in the Chabahar project. As the all-knowing Atlantic Council summarised, if India bows to the US, it risks losing Iran to China.

India also needs Iran’s ports to complete the so-called International North-South Transport Corridor (INSTC), which would ideally connect India to the Persian Gulf, Central Asia, Russia and even Europe, and would allegedly increase India’s $1 billion trade with Central Asia to a whopping $170 billion.

China already has a direct connection to Central Asia, placing India at a disadvantage by default, and its trade with Central Asian nations is already at $30 billion; well above India’s. In 2000, India, Iran and Russia signed an agreement for the purpose of developing the North-South transport corridor.

India, Iran and Afghanistan held a tripartite meeting in September last year in which they discussed the Afghanistan peace process, cooperation against terrorism, as well as Chabahar Port. It is noticeable, to say the least, that Pakistan and China were not involved in this discussion. Just last week, Iran and India held a similar meeting.

India is also currently developing two gas fields, Farzad-B in Tehran and the South Pars field located between Iran and Qatar (which is the largest gas field in the world). Trump may soon begin to realise how difficult it is to isolate these states from one another after the simple examination of a world atlas.

Even the effect of US sanctions on ordinary people that the United States consider allies appear to not have been taken into account. Most reports allege that the absence of Iranian oil makes oil market prices shoot through the roof, affecting common Indian residents who had been enjoying cheaper oil prices under the JCPOA. Does the US want the people of India to hate Iran, or to hate the enforcer of these sanctions?

Reportedly, a “preferential trade”agreement between Iran and India is also in the works which will come into force in the not-so-distant future. The two nations have also already signed an agreement worth $2 billion on cooperation in the railway sector. At the start of this year, Iran also announced it would invest Rs 1,500 crore to expand a refinery run by Chennai Petroleum Corp, in a move that sees Iran attempting to counter US-imposed sanctions and cement its position in India.

You won’t see this in the mainstream media, but India also quietly allowed an Iranian bank to open a branch in Mumbai just last week.

Despite undue pressure from Washington, at the end of the day India still has indicated it will abide by its sanctions and the waiver that it has been given (as far as possible).

It is therefore unclear what the US is hoping to achieve through this strategy. Yes, sanctions greatly weaken Iran’s economy and threaten the collapse of its currency, but they also push these adversarial states to consider agreements which circumvent the use of the US dollar, even with Washington’s more traditional allies. If enough countries drop the use of the dollar in bilateral trade, the dollar will no longer have the international use it once had. As of right now, Venezuela, Qatar, China, Russia, India and Iran – just to name a few – are all nations who have considered the use of alternative currencies to counter Washington’s sanctions regime.

If the ultimate aim of the US is to weaken the dollar’s status on the global markets, then it can be my guest.

RT.com



26 Comments on "Iran, India Ditch Dollar In Oil Trading To Counter ‘Bullying’ US Sanctions"

  1. twocats on Tue, 15th Jan 2019 8:05 pm 

    well, i’ll leave it to the die-hard ameri- “kakaka”ns to tell us why this is just RT propaganda 🙂 either way, this shit is entertaining as hell.

  2. makati1 on Tue, 15th Jan 2019 8:44 pm 

    twocats, it’s always enjoyable watching the world give Amerika the finger.

  3. Theedrich on Wed, 16th Jan 2019 2:00 am 

    The U.S. superpower is being unsupered.  The DeepState demigods in Washington cannot grasp the fact that, even though they “heroically” genocided millions of German and Japanese civilians in WW II, the days of their global supremacy are numbered.  Nothing lasts forever.  Slowly, slowly, the sun is setting on Captain America and his fecal self-worship, to say nothing of his bribery, threats and wars to force his will on other peoples and cultures.  Today the name of the game is global high-tech chess, with many contestants opposing what Kunstler so aptly calls the idiocracy.  Artificial Intelligence (AI) is just getting off the ground, and promises to cut the vaunted superiority of Silicon Valley, Redmond and other U.S. cybercenters down to size, if not to take them hostage by one means or another.

    Combine these facts with the cladestine opium war which China is waging (via Mexico) against the U.S., and with the insidious egocentric sloth now infiltrating over half of Yankee youth, and it is clear that the “sanctions” which the D.C. swampland insists on imposing on the rest of the world will result only in a blowback lasting much longer than the imaginary success expected from “democratizing” (i.e., subjecting) the rest of the world beneath the American heel.

  4. makati1 on Wed, 16th Jan 2019 2:29 am 

    Once again, Theedrich, you paint a very accurate picture of the failing “empire”. The Us has dropped so far behind most of the world in so many ways.

    The MIC keeps demanding more and more money to produce junk that doesn’t work, like the F35 and to build ships that breakdown before they can get to their assigned port. The newest $13,000,000,000.00 carrier cannot even lift their weapons from the lower decks because they don’t have the parts for the lifts.

    “In its latest report, the director of operational test and evaluation identified poor or unknown reliability of the newly designed catapults, arresting gear, weapons elevators, and radar.”

    https://navaltoday.com/2018/05/23/uss-gerald-r-ford-returns-to-port-with-propulsion-issues/

    Slip slidin’….

  5. I AM THE MOB on Wed, 16th Jan 2019 4:01 am 

    Watch me prove how dumb and ignorant Theedrich is..Artificial intelligence doesn’t even exists..They are just naming computer programs after it..This is why you are an economic loser/nazi like clogg..Its not the immigrants fault, its yours..Looks like the board senile old mummy Mak loves you though..He is a fag though..

  6. Cloggie on Wed, 16th Jan 2019 4:07 am 

    “Artificial intelligence doesn’t even exists.”

    http://www.extremetech.com/extreme/196554-a-new-computer-chess-champion-is-crowned-and-the-continued-demise-of-human-grandmasters

    Mobs intelligence has just been beaten. Not that it takes much to accomplish that…

  7. I AM THE MOB on Wed, 16th Jan 2019 4:27 am 

    ‘Artificial Intelligence’ Has Become Meaningless
    https://www.theatlantic.com/technology/archive/2017/03/what-is-artificial-intelligence/518547/

    Don’t believe the hype: the media are unwittingly selling us an AI fantasy
    https://www.theguardian.com/commentisfree/2019/jan/13/dont-believe-the-hype-media-are-selling-us-an-ai-fantasy

  8. I AM THE MOB on Wed, 16th Jan 2019 4:28 am 

    Never forget what we’re up against

    https://i.redd.it/5zb7gg9ucna21.jpg

  9. I AM THE MOB on Wed, 16th Jan 2019 4:41 am 

    Marx and Engels predicted everything

    https://i.redd.it/sekz3l30gna21.png

  10. I AM THE MOB on Wed, 16th Jan 2019 4:47 am 

    Trump’s economy is great for billionaires, not for working people -Bernie Sanders

    https://www.theguardian.com/us-news/2019/jan/16/trump-economy-billionaires-working-people?CMP=twt_gu

  11. Cloggie on Wed, 16th Jan 2019 5:17 am 

    Never forget what we’re up against

    https://www.youtube.com/watch?v=u5-dkvfJfWI

    https://www.youtube.com/watch?v=—g-f_I2yQ

    The time has arrived for the Great Revenge for WW1/WW2 and the resurrection of the white race/European civilization. No mercy. Only US white nationalists, taking orders from PBM, will be spared. Iraq, Afghanistan and Syria were only the beginning of the dismantling of the empire.

    https://s.newsweek.com/sites/www.newsweek.com/files/styles/embed_tablet/public/2015/04/17/0417namfall01.jpg

  12. Cloggie on Wed, 16th Jan 2019 5:32 am 

    Marx and Engels predicted everything

    They predicted everything and subsequently were wrong about everything.

    Absolute egalitarianism means the death of society. Everybody making $150/month.

    Communism = “nothing works”

    https://i.dailymail.co.uk/i/pix/2013/01/01/article-2255693-16B57A8C000005DC-948_964x647.jpg

    In Russia a shabby bag was called an avoshka (“perhapsy”)…

    https://upload.wikimedia.org/wikipedia/commons/thumb/c/cf/Avoska.jpg/300px-Avoska.jpg

    …that was to be used for standing in a bread queue for hours, to *perhaps* lay your hands on a loaf of bread, to be put in your “avoshka”.

    Mobster wants to introduce that again, after he and his tribe have sicked the fresh imported third worlders as a revolutionary proletariat against the whites:

    https://www.youtube.com/watch?v=RC-Cqkq6zWc

    However, as the same Marx used to say: “first time a tragedy, second time a farce”.

    CW2 will provide the opportunity for PBM to intervene, split the joint up and incorporate a large part of white America in a Commonwealth of European peoples.

    Bring it on, mobster, your intended bolshevik revolution 2.0. and see what happens next.lol

  13. makati1 on Wed, 16th Jan 2019 5:47 am 

    MOB, you keep proving my assertion that you are an immature, stupid, arrogant snowflake. A Davy clone. Nothing more. Get a job and out of your mom’s basement. Theedrich is 100 times as intelligent as you are. And 1,000 times more mature.

    Theedrich: “Artificial Intelligence (AI) is just getting off the ground,…”

    MOB: “Artificial intelligence doesn’t even exists” (Incorrect English by the way)

    WIKI: “AI techniques have become an essential part of the technology industry, helping to solve many challenging problems in computer science, software engineering and operations research”

    https://en.wikipedia.org/wiki/Artificial_intelligence

  14. Fat Bastard on Wed, 16th Jan 2019 5:53 am 

    Makati1 why don’t you, I AM THE MOB and Cloggie get a room. You three act like this is your personal bitch forum.

  15. makati1 on Wed, 16th Jan 2019 5:56 am 

    BTW MOB, FYI:

    “10 Powerful Examples Of Artificial Intelligence In Use Today” (2017)

    https://www.forbes.com/sites/robertadams/2017/01/10/10-powerful-examples-of-artificial-intelligence-in-use-today/#6eeef8ed420d

    “10 Examples of Artificial Intelligence You’re Using in Daily Life”

    https://beebom.com/examples-of-artificial-intelligence/

    “Xerox and PARC Define the Era of Artificial Intelligence”

    https://www.xerox.com/en-us/insights/artificial-intelligence-today

    “9 Powerful Examples of Artificial Intelligence in Use Today”

    https://www.iqvis.com/blog/9-powerful-examples-of-artificial-intelligence-in-use-today/

    Let us know when you I.Q. actually exceeds your age number. LMAO

  16. makati1 on Wed, 16th Jan 2019 5:57 am 

    Fatty, why don’t you ignore us if it bothers you? All the posts begin with our name.

  17. Davy on Wed, 16th Jan 2019 6:02 am 

    “As Germany And France Come Apart, So Too Will The EU”
    https://tinyurl.com/y9mfnuzc

    “If we follow the logic and evidence presented in these seven points, we are forced to conclude that the fractures in France, Germany and the EU are widening by the day. When is a nation-state no longer a functional state?”

    “1. no effective military forces 2. no control of their own borders 3. no control of their currency and banks 4. a government with a ‘diverse’ population in which the majority either has no loyalty to Berlin (recent ‘refugee’ immigrants) or has dropped its loyalty (large parts of Bavaria and Baden-Wurttemberg), and which is also losing the allegiance of the many eastern European immigrants in Germany. These people are among the most energized opponents of the ‘refugee’ influx. 5. Fast rising anarchy and lawlessness by the recent ‘refugee’ immigrants, and which is well known to the population, as are the official orders to the police to minimize crime statistics reporting by not opening official cases. And 6. A mass media believed by no one due to the bald lies it broadcasts 24/7 daily about numbers 1-5. …will soon cease to exist. This is confirmed by: 7. The continuing spiral of the ruling post WWII political parties into their own political black holes. CDU/CSU on the right and SDP on the left have all lost their hold on the modern German population. The biggest joke of all is that Theresa May is negotiating the terms of “Brexit” from the EU with a political corpse and not a viable polity. Another round or lap is coming soon. Personally I think the only thing staving off another eurozone banking crisis is the absolute certainty that no imaginable German government can currently agree to the slightest external concession without risking an internal political collapse. Thus all the various Eurozone elites involved are refraining from provoking such a crisis for calculated narrow reasons. This leaves it to a European mob in some capital to initiate it by confronting a national government with either internal political collapse or re-entering EU-wide monetary and fiscal conflict with the ECB/EU gang. And yes, I’m sure you spotted the next part. Poland and Hungary acting on behalf of the Phoenix Rising Ersatz Austro-Hungarian Empire will twist the EU’s tail at that time as hard as they can for maximum regional advantage.”

    “In the long run of history, the apparent solidity of 20 or 30 years can shatter very rapidly as populations under increasing financial and political stress default to much more enduring divisions and loyalties.”

  18. Davy on Wed, 16th Jan 2019 6:13 am 

    “Europe Is Burning”
    https://tinyurl.com/yalhnea2

    “The underlying thought is the same: people are fed up with incumbent politicians and their affiliation with the European project. And nobody in Brussels really appears to be willing to realize this: the only thing they talk about is more Europe. But all these changes will now be reflected in the power politics of the European parliament. And they do know that. They just hope they can limit the damage through the model in which power is divided in Europe.”

    “They think they will be able to continue business as usual, and accumulate more power and sovereignty in the process, while support for the EU crumbles more by the day. But that’s all in the far far future, that is a whole 4 months away. And who knows what Europe will look like by then? Brussels sure doesn’t seem to know, or want to.”

    “Of even more immediate concern may be Germany’s economic performance. Because the latest signs are not encouraging. Germany and Holland have done very well, but that is because they have all the others as their ‘domestic’ market. And now not even that turns out to be enough. Germany’s numbers are going down fast:”

    “Then again, for now, worries about Germany will be trumped by those about France and Britain. The numbers of Yellow Vests in the streets of France was much larger again the past weekend than the last few ones. Macron keeps on making ever bigger mistakes. This Saturday, his riot police was filmed carrying semi-automatic weapons with live ammo. As he claimed that many of his people want to get things without making any effort. Macron all along has tried to drive a wedge between the protesters and the people. But a large majority of the people support the protests, even if they don’t don a yellow vest.”

  19. I AM THE MOB on Wed, 16th Jan 2019 6:52 am 

    Mak

    You don’t know anything about technology..You are like clogg..two elderly geezers..I worked for a fortune 500 tech company before..AI doesn’t exists..They are naming computer programs AI..

    There is an old saying, when you are the smartest person in the room, time to find another room..

  20. I AM THE MOB on Wed, 16th Jan 2019 6:54 am 

    Clogg

    We won Iraq and got the oil..that is all we wanted..And Afghanistan is not meant to be won..Just to offload inventory..You are so naive..And there isn’t going to be a civil war..This isn’t the 1800’s..You nutter..You old geezers always long for the past..America will collapse but it will be the last man standing..

  21. I AM THE MOB on Wed, 16th Jan 2019 6:56 am 

    Hey clogg and Mak

    I have some magic beans I would love to sell you two..Drop me your email and we can hook up!

    LMFAO!

  22. JuanP on Wed, 16th Jan 2019 7:31 am 

    I am back, bitches! I just got back from a surfing vacation in Costa Rica. I am recharged and refreshed, and ready to continue fucking with the Exceptionalist and his multiple personalities for the foreseeable future.

  23. Chrome Mags on Wed, 16th Jan 2019 11:23 am 

    The article was about India and Iran ditching the USD for oil purchases. Good for them! I hope other countries do the same. More like this to work towards leveling the currency playing field.

  24. makati1 on Wed, 16th Jan 2019 9:45 pm 

    MOB, your “You don’t know anything about technology…” rebuttal is so blatantly stupid you set a new record for this site. Then you followed it up with your usual childish putdowns, proving your ignorance.

    I posted reputable refs that disprove your assertions and then you expect me to believe that you worked for some tech company. Were you a clerk in the now defunct Radio Shack? Nah! Even they were more educated than you are. LOL

    BTW: I worked for IBM but that doesn’t make me a techie. I made copies of programs on floppies on the night shift for six months to feed my family when the construction industry was in a funk in the 80s.

  25. peakyeast on Wed, 16th Jan 2019 10:58 pm 

    Artificial intelligence do exist and will outperform humans very soon.

    It is all a mattter of computing power at this point. Another improvement of 1000x CPU speed and we are well into functional and superior AI.

    These programs are all ready – just waiting for the right hardware.

    In 1980 we had mainstream PCs with 4MHz – today we have PCS with 4GHz – besides vastly improved instruction sets, multi cpus, much better supporting HW.

    The increase in 40 years is several 1000x.

    With optical gates, switches and even memories alone we will have broken the barrier to AI.

  26. Davy on Thu, 17th Jan 2019 5:08 am 

    “Artificial intelligence do exist and will outperform humans very soon.”

    There are key biological skills computers will never touch because they are not based on programing, logic and reason. The randomness of the human mind and its ability to imagine is not something inherent to AI. The ability of humans to be variable with finesse is something that will be hard to program. AI also must be supported with industry and electricity that can be turned off quite easily. EMP’s will be rough on AI for a taste of how easy AI can be stopped. AI is amazing and what is fascinating is how far AI as come in such a short time but let’s keep its strengths and weaknesses in perspective strengths are also weaknesses in the real world.

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