Iran counts on selling 1.4 mil b/d of crude oil at $85/b in new year

Iran is counting on selling 1.4 million b/d of crude oil at $85/b under next year's budget law, partly by the use of a barter system, with a general draft approved by parliament on Jan. 22, local media reported.

"The next year's budget has predicted oil barter to produce income," President Ebrahim Raisi said in a speech addressing the assembly, according to news agency ISNA.

The new Iranian year will start in March. Platts-assessed Dated Brent was $85.90/b on Jan. 20, according to S&P Global Commodity Insights data.

The new year's crude and oil products sales will amount to $26 billion, based on the state-set rate, according to the new budget. That means Iran expects its oil income to rise 25% compared with the current year in local currency, which has declined due to inflation.

Raisi did not give more details on the barter plan. In 2021, his administration discussed the idea of paying back construction projects with oil. Contractors who were owed by the government could be reimbursed by oil and derivatives under a plan that requires buyers to find "new markets" other than existing customers of Iran's oil ministry.

Armed forces would also be granted a "quota" of crude oil and gas condensates to be refined in the Iranian refineries, and use the income, ISNA reported. Debts to several other institutions, including "non-governmental and revolutionary" entities, can be settled by crude allocations, it said.