Iran plans to get around US sanctions on its oil sales by selling its petroleum and conducting international trade in currencies other than the US dollar, the Washington Post quoted the Iranian diplomat who negotiated the nuclear deal as saying.
“The actual mechanism would be to avoid dollars,” Iranian Foreign Minister Mohammad Javad Zarif told reporters at a roundtable at the Iranian mission to the United Nations in New York on Saturday evening, saying countries are starting to make agreements to use their own currencies in bilateral trade.
“You can use your own currency,” he explained. “Sell stuff in your own currency, buy stuff in the other country’s currency, and at the end of a specific period, balance it out in a non-dollar currency. It’s quite possible and may even be profitable.”
The United States is poised to impose sanctions in early November targeting Iran’s oil sector. The sanctions were suspended under the nuclear deal that the United States and five other world powers agreed to in 2015. But after President Trump announced in May that he was withdrawing from the deal, U.S. officials have pressured countries around the world to stop their oil sales from Iran to prevent it from its chief source of income. They also threatened secondary sanctions if the sanctions are defied.
It is unclear how successful the strategy to avoid them will be. The power of US sanctions lies in the use of the US dollar in most international transactions. A foreign company that sends its proceeds from trade with Iran through an international bank would likely face sanctions because part of it would be conducted in dollars. An international company with an American employee who has something to do with a transaction, no matter how inconsequential, could also run afoul of US sanctions.