“Iran earns between $1 billion and $3 billion a year by smuggling its fuel oil through neighboring Iraq, allowing it to sell the fuel to circumvent U.S. sanctions.”, — write: epravda.com.ua
Iran has created schemes for smuggling its fuel oil through neighboring Iraq, which allow it to sell billions of dollars worth of fuel to bypass US sanctions, five sources familiar with the situation said in a comment to Reuters. The scheme exploits the Iraqi government’s policy of providing fuel oil to asphalt plants at heavily subsidized prices. It involved a network of companies, groups and individuals from Iraq, Iran and the Persian Gulf countries, as evidenced by the words of sources and three Western intelligence reports – two dated August this year and one undated. Under the scheme, between 500,000 and 750,000 metric tons of heavy fuel oil, including high-sulfur fuel oil, equivalent to 3.4 million to 5 million barrels of oil, are diverted from refineries each month and mostly exported to Asia, two sources said.Advertisement: Iran is considering its neighbor and ally Iraq as an “economic lung” and has significant military, political and economic influence through the Shiite militias and political parties it supports. Iran receives hard currency through exports to Iraq and avoids US sanctions through the Iraqi banking system, according to Iraqi and US officials. Among the two main routes by which fuel oil is exported from Iraq, one involves mixing it with a similar product from Iran to pass it off as Iraqi. Advertisement: This helps Tehran avoid tough US sanctions on energy exports, five sources said. The other route involves exporting fuel oil intended for the subsidized program using forged documentation to hide its origin. Iran directly benefits from the first route: Iranian fuel oil is usually sold at a discount due to sanctions, but can be sold at a higher price if passed off as Iraqi. The second route benefits Iraqi militias, which are backed by Iran and control the smuggling scheme. Three sources estimated revenues from both routes based on trade volumes and relative prices. Their estimates range from $1 billion to over $3 billion per year.
