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India
Not Seeking Iran Oil Waiver From U.S.
 NEW DELHI (Dispatches) - India is not seeking a waiver from
the United States that would protect buyers of Iranian oil
from a fresh round of sanctions, and New Delhi continues to
import from Tehran, Indian Foreign Secretary Ranjan Mathai
says.
New U.S. sanctions, authorized on December 31, penalize any
financial institution dealing with Iran's central bank and
could make it more difficult for India to pay Iran for oil
imports. An Indian delegation is currently in Tehran for
talks.
The U.S. still allows waivers for firms in countries that
significantly reduce dealings with Iran or when it is either
in the U.S. national interest or necessary for energy market
stability.
Japan, South Korea and Turkey have all said they could seek
waivers.
But Mathai said New Delhi was not seeking an exemption and
implied it did not see the new sanctions as binding.
"We have accepted sanctions which are made by the United
Nations. Other sanctions do not apply to individual
countries," Ranjan Mathai told reporters on Tuesday.
"We continue to buy oil from Iran."
Asia's third-largest economy is striving to balance the need
to keep importing about $12 billion of Iranian crude
annually.
The United States and its allies in Europe and elsewhere are
putting pressure on Iran to curb a nuclear program they say
is aimed at developing an atom bomb. Iran says its goal is
to produce nuclear power.
Previous sanctions already made it harder for India to
import the 350,000-400,000 barrels per day (bpd) it buys
from Iran, about 12 percent of its oil needs. In 2010, the
central bank scrapped a long-standing clearance mechanism,
triggering a scramble by importers to find a new way to pay.
Since last year, Turkey's Halkbank has routed India's
payments to Iran, but that conduit is seen by the government
as unstable in the face of the latest U.S. sanctions.
Halkbank has already refused to open an account for
state-run Bharat Petroleum Corp for oil from Iran.
An Indian official delegation is now in Tehran trying to
find a way to continue the oil trade.
"A ... delegation is on its way to work out the mechanism
for continued purchase of oil from Iran and to work out the
financing mechanism," Mathai said.
Mohsen Qamsari, head of international affairs at the
National Iranian Oil Co., told the Oil Ministry's website
SHANA on Tuesday there was no problem in doing business with
India.
"Iran's credit from India has been completely reimbursed,
and the money flow issue from this country is proceeding
normally with no problem," Qamsari said.
Qamsari also said Iran did not have any unsold oil as there
was a good appetite for the Islamic state's oil.
"Right now, there is no oil on the water ... There are many
requests for buying Iran's crude, and we don't have extra
oil to sell," he said.
Indian Foreign Secretary Ranjan Mathai
Oil Rises to Three-Day High in NY
 NEW YORK (Bloomberg) -- Oil rose to the highest level in
three days in New York as speculation supplies from Iran
will be disrupted countered concern that economic growth
will slow.
Iran called on Saudi Arabia to be “more wise and
responsible” after the kingdom said it could make up for any
supply loss resulting from a European ban on imports of
Iranian crude. The International Energy Agency reduced its
2012 global oil demand forecast, after consumption fell in
the fourth quarter for the first time since 2009, warning it
may cut estimates further.
“Only Saudi Arabia is currently in a position to plug the
gap from Iran,” said Carsten Fritsch, an analyst at
Commerzbank AG in Frankfurt. “This fact should lend support
to the oil price for the time being.”
Crude for February delivery on the New York Mercantile
Exchange rose as much as $1.16, or 1.2 percent, to $101.87 a
barrel, the highest price since Jan. 12, and was at $101.71
at 12:24 p.m. London time. Floor trading was shut Jan. 16
for the Martin Luther King Jr. holiday and electronic trades
were booked with yesterday’s transactions for settlement.
Brent oil for March settlement on the London-based ICE
Futures Europe exchange was up 50 cents at $112.03 a barrel.
The European benchmark crude was at a $10.13 premium to New
York contracts for the same month. The spread closed at
$10.66 yesterday, the lowest settlement level in nine days.
It was a record $27.88 on Oct. 14.
Saudi Arabia can “easily” boost crude production to as much
as 11.8 million barrels a day to offset a shortfall from
Iran, Oil Minister Ali al-Naimi said in an interview with
CNN on Jan. 16. The kingdom has the capacity to produce 12.5
million barrels a day and pumps about 9.8 million, he said.
“If this comment is the official stance of Saudi Arabia we
advise Saudi officials to be more wise and responsible in
their approach,” Iranian Foreign Minister Ali Akbar Salehi
said yesterday, according to the state-run Fars news agency.
European Union foreign ministers are scheduled to meet Jan.
23 to decide on proposed sanctions on Iran’s oil imports, in
a bid to halt its nuclear program. Iran says its nuclear
program is only for peaceful purpose.
The Persian Gulf state, the second-largest producer in the
Organization of Petroleum Exporting Countries after Saudi
Arabia, has threatened to block the Strait of Hormuz in
retaliation. About 20 percent of the world’s oil flows
through the waterway, which is 21 miles (34 kilometers) wide
at its narrowest point, according to the U.S. Energy
Department.
Meanwhile, the U.S. asked South Korea to halve oil imports
from Iran, the Dong-A Ilbo newspaper reported today, citing
an unidentified government official. South Korea’s stance is
to cut shipments by about 30 percent, according to the
report. A U.S. delegation visits Japan today to push for
sanctions support.
New York bourse
IMF Seeks Up to $500b in New Funds
BRUSSELS (AP) — The International Monetary Fund said
Wednesday that it's aiming to increase its financial
firepower by around $500 billion so it can give out new
loans to help mitigate a worsening financial crisis.
Responding to widespread speculation surrounding its funding
requirements, the Washington-based institution said its
staff estimates that countries around the world will need
about $1 trillion in loans over the coming years. Most of
the concerns center on the 17-nation eurozone, which has
been embroiled in a debt crisis for around two years.
"At this preliminary stage, we are exploring options on
funding and will have no further comment until the necessary
consultations with the Fund's membership have been
completed," a Fund spokesman said in a statement.
Thanks to some $200 billion that European countries have
recently promised to the IMF, it is already more than one
third on its way to reaching its fund-raising goal.
The IMF has put up about a third of the financing of the
eurozone's bailouts over the past two years, but there are
growing worries that non-European countries will also need
more help given the worsening economic outlook.
Earlier, its sister organization, the World Bank, urged
emerging countries that they have to be ready for a severe
global downturn if the crisis in the 17-nation eurozone
intensifies.
The eurozone, in particular, has been pushing countries
around the globe to give more funds to the IMF in the hope
that it would build up a larger firewall to stop the
continent's debt troubles from spreading to large economies
like Spain, Italy or even France.
But so far, even countries relatively flush with cash as
China or Brazil have been reluctant to put up more money for
Europe. The United States is also reluctant to increase the
fund's resources.
British Prime Minister David Cameron said Wednesday that the
government would be prepared to back an increase but that he
would require approval from his Parliament.
"We believe the IMF must always lend to countries, not to
currencies," Cameron said at a news conference with Italian
Premier Mario Monti. "We would only act if that was with
others, not just as part of a eurozone measure.
However, Cameron said it's up to the eurozone itself to
prove that it's "standing behind its own currency."
How the IMF's fund-raising goal will be reached is set to be
discussed at a meeting of finance ministers of the Group of
20 leading economies in Mexico next month.
European Debt Crisis, High
Unemployment Threaten Economy Growth
 TEHRAN (UNIC) – Countries throughout the world
will experience an economic slowdown this year as the
sovereign debt crisis in Europe continues to unfold,
according to a United Nations report launched Tuesday that
also warns that governments must urgently address high
unemployment rates, particularly among youth.
The World Economic Situation and Prospects 2012 (WESP)
report gives a detailed picture on seven geographical
regions and forecasts that growth rates for the next two
years will slow down in most of them, with the exception of
the African continent, which will continue to enjoy growth
due to stable commodity prices and foreign investment.
The risks of further worsening of the situation in Europe
and the United States have increased.
The report, released by the UN Department of Economic and
Social Affairs (DESA), points to the European sovereign debt
crisis that erupted in Greece last May as a major shock to
the global economy, whose multiple negative effects will
continue to reverberate around the world.
“Failure of policymakers, especially those in Europe and the
United States, to address the jobs crisis and prevent
sovereign debt distress and financial sector fragility from
escalating poses the most acute risk for the global economy
in the outlook for 2012-2013,” the report states.
The report estimates that growth in the European Union (EU)
is expected to be only 0.7 per cent in 2012, substantially
lower than the 1.6 per cent growth registered last year. In
addition, unemployment throughout the continent will remain
near 10 per cent in the euro area, having changed very
little since September 2009.
Africa is expected to continue to grow, defying the global
trend. The continent is forecast to see an increase in its
overall growth from 2.7 per cent in 2011 to 5 per cent in
2012 and 5.1 per cent in 2013. This growth will mainly be
driven by relatively strong commodity prices, solid external
capital inflows and continued demand and investment from
Asia.
However, growth will vary greatly among countries in the
continent due to military conflicts, corruption, lack of
infrastructure and severe drought in certain areas. The
report also warns that unemployment and poverty remain major
problems and sources of instability, which have already led
to political unrest in North Africa.
South Africa is expected to have the strongest economic
growth in 2012, supported by growing demand from Asia,
continued fiscal stimulus measures and an increase in
consumption driven by rising wages.
The economic picture in the Arab World will continue to be
subject of high uncertainty due to the political transition
and civil protests brought by the Arab Spring. Regional
growth is forecast to decline from 6.6 per cent to 3.7 per
cent as violent clashes hampered economic activity in
several Arab countries. Social unrest also affected trade
and tourism revenues, particularly in Lebanon.
However, the report states that generous social spending
measures implemented in 2011 by Arab governments such as
Saudi Arabia as a way to alleviate popular protests helped
boost economic growth and the impact of these measures will
continue to be felt throughout 2012.
As with Europe and Africa, unemployment remains a key
problem in the region. Despite extremely low female
participation rates, unemployment rates in the region are
among the highest in the world, especially among the
educated youth, and the report warns that leaving
unemployment unaddressed represents a major risk to
stability in the region.
In East Asia growth is projected to decline to 6.9 per cent
in both 2012 and 2013. China, the biggest economy in the
region, is also expected to slow down from 9.3 per cent to
8.7 per cent growth in 2012. A major deceleration from
China, however, would represent a more pronounced slowdown
for the rest of the region.
The South Asian and Latin American and Caribbean regions
remain particularly susceptible to the future of developed
economies as both the EU and the US are key export markets
as well as sources of tourism revenue.
For Latin America, a slowdown in China would also adversely
affect the region as it is a major buyer of its commodities
and a key investor in South America.
“Clouds over the region are darkening. The risks of further
worsening of the situation in Europe and the United States
have increased,” UN economist Rob Vos said in his
presentation of the report in Mexico City. “Latin American
and Caribbean economies would be hard hit and growth could
drop below 1 per cent in the region, with Brazil stagnating
and Mexico falling into recession along with the United
States economy.”
Last month, DESA had warned that premature fiscal austerity
measures by developed countries risked prompting a new
global recession, and recommended additional stimulus
measures to stimulate job creation and investment. |
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