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Is Iran Opening A "Secret Passage" To Asia For Russian Crude?

Tyler Durden's picture




 

Submitted by Dave Forest via OilPrice.com,

Russia is looking to expand its influence through oil trade. And a little-reported deal this week may give it access to an entirely new part of the planet when it comes to crude exports.

That's the Persian Gulf. Where reports suggest Russia is close to negotiating a "secret passage" for its oil shipments.

The move is coming through a deal with Iran, which that government says could open the door for crude oil swaps between the two countries -- facilitating exports of "Russian" oil out into Asia and beyond.

Iran's Deputy Petroleum Minister Amir Hossein Zamaninia told local press Monday that Russian energy company representatives will be arriving in Iran this week to discuss such a swap deal.

Here's how it would work.

Russia lacks access to ocean shipping routes beyond the Pacific and Arctic. Iran has better access, through its ports on the Persian Gulf.

But Russia does have ports on the Caspian Sea. And as the map below shows, that provides a short shipping route into Iran.

 

Russia and Iran can exchange crude oil shipments along the Caspian Sea

The swap scheme would see Russian crude oil sent to Iran, in exchange for equal shipments of Iranian crude flowing to Russia.

And from there, it will be interesting to see what happens.

Officials said that Russian oil would likely be used within Iran's northern provinces. But the swaps agreement opens up another possibility -- Russian crude could be sent further south, and even exported through Persian Gulf ports.

That would give Russia unprecedented access to markets around the Indian Ocean -- including go-to crude buyers in Asia, greatly changing the dynamics of oil markets in this part of the world.

It's unclear how much oil might be exchanged under the swap agreements. We should have more details after this week's meetings are completed -- watch for more details coming.

Here's to a crude exchange.

 

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Thu, 11/05/2015 - 22:34 | 6756277 Money Boo Boo
Money Boo Boo's picture

MOAR COWBELL!!!!

Thu, 11/05/2015 - 22:42 | 6756299 NotApplicable
NotApplicable's picture

"Crude oil swaps"

*head asplodes*

Thu, 11/05/2015 - 22:42 | 6756302 Money Boo Boo
Money Boo Boo's picture

we are always at woar with eastfantasia!

Thu, 11/05/2015 - 23:00 | 6756342 Boris Alatovkrap
Boris Alatovkrap's picture

In cold war, Russia is sworn enemy of USA, but at least is respect USA. Now, is not even modicum respectful of Amerika ability to execute even simple battle plan. Red line is draw, but there is no respect for country is draw red line and run away afraid.

Thu, 11/05/2015 - 22:38 | 6756282 Fukushima Fricassee
Fukushima Fricassee's picture

i DON'T KNOW BUT i WOULD . ANY PRUDENT SELLER OF CRUDE WOULD.

Thu, 11/05/2015 - 22:41 | 6756285 Life of Illusion
Life of Illusion's picture
http://www.businessinsider.com/ap-kerry-offers-support--friendship-to-ce... Nov 3 2015

For these reasons, U.S. Secretary of State John Kerry ventured Tuesday to a place few world leaders and even fewer journalists or human rights monitors ever see, dangling the opportunity of greater U.S. investment, expanded security cooperation and a strategic counterweight to nearby Russia and China if the government improves its human rights record.

Kerry issued a similar offer earlier in the day in Tajikistan, echoing weekend pitches in Kyrgyzstan, Uzbekistan and Kazakhstan. Speaking Monday at Kazakhstan's Nazarbayev University, he addressed the challenge facing the region's governments, particularly as they respond to the threat of expanded Islamic State activity.

Thu, 11/05/2015 - 23:14 | 6756408 BarkingCat
BarkingCat's picture

>>>>Speaking Monday at Kazakhstan's Nazarbayev University, he addressed the challenge facing the region's governments, particularly as they respond to the threat of expanded Islamic State activity.<<<<<

In other words, play ball with us and we will not sponsor extremists in your country nor import foreign ones there.

Fri, 11/06/2015 - 05:45 | 6757016 lakecity55
lakecity55's picture

Surely they are not going to physically swap oil. All they have to do is Russians sell a million barrels through their routes and give the profit to Iran. Iran sells its oil thru their routes and gives the profits to Russia.

So, Vlad buys a million rubles of Iranian Oil and has Iran sell it. He gets the profit. The Ayatollah buys a million rials worth of Russian oil and Russia sells it, giving the profit to the Ayatollah.

Seems like the only real problem is figuring out the rubles to rials conversion.

Fri, 11/06/2015 - 07:29 | 6757115 Non Passaran
Non Passaran's picture

Or how much gold per ton of oil

Fri, 11/06/2015 - 08:54 | 6757242 JohninMK
JohninMK's picture

Russia ships oil to northern Iran and it is used there. Iran ships same amount of oil out of Persian Gulf to Russian customers.

Iran saves shipment costs of sending their oil north.

Russia saves shipment costs of sending their oil to the Gulf. Plus gets access to customers arounf the Indian Ocean.

Looks a bit of a no-brainer, but both are hard negociators!

Thu, 11/05/2015 - 22:39 | 6756286 Baby Bladeface
Baby Bladeface's picture

Uncle Sam response will be tantrum to include screaming while throwing toys from playpen and the diaper shits.

Thu, 11/05/2015 - 22:42 | 6756298 logicalman
logicalman's picture

SOP

Fri, 11/06/2015 - 05:50 | 6757022 lakecity55
lakecity55's picture

The smart guys are the Turkmen in Turkmenistan. Berkimohammedev keeps everyone at arm's length and sells to China, mostly. There are Russian rigs in the Caspian, I've seen them. So, the rest of the Turkmen in the 'stans should keep the business model Turkmenistan uses.

Thu, 11/05/2015 - 22:42 | 6756301 Dead Canary
Dead Canary's picture

Uh, why are they swaping equal amounts of oil?

Huh?

Thu, 11/05/2015 - 23:17 | 6756427 Abbie Normal
Abbie Normal's picture

Some southeast Asian countries won't buy oil from Iran due to sanctions, but they will buy from Russia, except that the supertanker fees are too high.  By swapping oil, the tanker fees drop significantly.

Thu, 11/05/2015 - 23:56 | 6756570 dirtscratcher
dirtscratcher's picture

I was wondering the same thing. That explains it nicely. Thanks for that.

Fri, 11/06/2015 - 01:42 | 6756818 Pliskin
Pliskin's picture

Yeh, nice addendum, the author should add that in somewhere.

Fri, 11/06/2015 - 05:55 | 6757025 lakecity55
lakecity55's picture

So, what they test it to see if it came from Russia?

Just swap out the prices.

Actually, why exactly does anyone have a "right" to slap sanctions on Russia or Iran?

Surely not the USSA and its poodle, who invade with or w/o UN permission or local permission and wreak mayhem. Who croaked and made the USSA King??

Is not the pursuit of profits enough? Why must there be gunz and dronz in the mix?

(rhetorical question).

Vichy needs to be air-bombed with Ex-Lax to flush out the shit.

Fri, 11/06/2015 - 00:32 | 6756671 Farqued Up
Farqued Up's picture

Marc Rich and Clinton get a cut?

Fri, 11/06/2015 - 01:51 | 6756833 uhland62
uhland62's picture

Marc Rich is dead. Glencore unfortunately not yet. 

Fri, 11/06/2015 - 11:38 | 6757979 Kirk2NCC1701
Kirk2NCC1701's picture

I'll take "What's a pipeline Loop" for $500, Alex.

Ever heard of Money Laundering?  Well, this is Oil Laundering.

Geez, you people lack imagination!

Thu, 11/05/2015 - 22:52 | 6756327 nmewn
nmewn's picture

No blood for oil!!!...lmao!

Thu, 11/05/2015 - 22:55 | 6756332 yomutti
yomutti's picture

Ha ha ha - Russia can't afford to trade oil for influence anymore. Putin has run the place so far into the groun that their main goal now is getting their hands on hard currency.

Thu, 11/05/2015 - 23:15 | 6756414 BarkingCat
BarkingCat's picture

They have quite a bit of it.
Russia has been buying gold every year.

Thu, 11/05/2015 - 23:16 | 6756421 Setarcos
Setarcos's picture

You really do not keep up with things do you!!

Tip: If you do not know anything much, then say nothing, at the risk of being maybe an idiot.

That's better than saying it and proving you are.

Fri, 11/06/2015 - 01:40 | 6756814 Pliskin
Pliskin's picture

We're way past the point of Yomutti proving he's an idiot at this stage.

Fri, 11/06/2015 - 01:53 | 6756836 uhland62
uhland62's picture

He's only parotting from the troll menu. Happens a lot.

Fri, 11/06/2015 - 00:04 | 6756596 hairball48
hairball48's picture

Spoken like a typical know-it-all ZH "six week wonder". :)

Fri, 11/06/2015 - 00:24 | 6756643 roddy6667
roddy6667's picture

You sound like you work for the Jew York times. STFU.

Fri, 11/06/2015 - 05:56 | 6757032 lakecity55
lakecity55's picture

Why, hello hasbara troll. Now, go away.

Thu, 11/05/2015 - 23:11 | 6756397 BarkingCat
BarkingCat's picture

>>>>...swap scheme would see Russian crude oil sent to Iran, in exchange for equal shipments of Iranian crude flowing to Russia.<<<<

Anyone else think this is stupid???
Are they just trying to generate transfer and shipping fees.
In simple terms.

Ivan gives sandwich to Omar so that Omar can deliver it to Chen.
Omar gives a sandwich to Ivan so that Ivan can deliver it to Arnold.
WTF???
There is a sandwich being passed around and bound to be dropped?

Thu, 11/05/2015 - 23:59 | 6756582 dsty
dsty's picture

ya, it does sound kind of funny

Would you trade me a quarter for a quarter?

OK, business is booming.

Fri, 11/06/2015 - 00:02 | 6756592 hairball48
hairball48's picture

The oil swap is "political" as described above regarding sanctions. Oil is also "fungible" like real money. And so the swap arrangement is simply political cover for the countries buying the Russian oil.

Thu, 11/05/2015 - 23:14 | 6756411 Son of Captain Nemo
Son of Captain Nemo's picture

None of my God Damn business whether the Iranians and Russians swap oil or precious "bodily fluids"...

It's not my government's fucking business either although they willl make it their business one way or the other until they can't anymore!

Gettin very close to the "can't anymore"... Where are our "30 special forces" guys again?!!!

 

Thu, 11/05/2015 - 23:27 | 6756471 o r c k
o r c k's picture

Sure It's the US's business. We just show them what great things we did for Syria.  and Libya,  and Iraq  and Chicago . 

Fri, 11/06/2015 - 01:39 | 6756813 BarkingCat
BarkingCat's picture

Detroit, do not forget Detroit!!!

Fri, 11/06/2015 - 05:59 | 6757035 lakecity55
lakecity55's picture

In WasWas cages, soaked in gasoline.
***
Send us sum ebola or nukes, McPain, or these guys get it!

Thu, 11/05/2015 - 23:17 | 6756426 Nassim
Nassim's picture

It makes absolutely no sense to send crude south over the Caspian Sea in return for a similar quantity going the other way. The writer is insane.

What is proposed is that Iran uses Russian oil and ships from its Persian Gulf ports an equivalent amount to Asia.

Precisely the same thing can be done in the opposite direction for gas. Iran to Southern Russia and Western Siberia to Europe.

Fri, 11/06/2015 - 00:42 | 6756696 Farqued Up
Farqued Up's picture

Paper oil, done constantly daily in the Wall Street casinos. Throw some Daisy Chain paperwork in for confusion and bingo!

Fri, 11/06/2015 - 01:37 | 6756805 Pliskin
Pliskin's picture

Ye, I thought the same, that makes more sense.

Fri, 11/06/2015 - 00:05 | 6756603 onmail1
onmail1's picture

A new Oil block is emerging.

Russia should also form a cooperation between others too ,i.e. Brazil, Malaysia , Venezuela etc. and fcuk the petrodollar , grind it to dust.

And then the west will simply crash.

Petrodollar demise is imminent.

 

Fri, 11/06/2015 - 02:00 | 6756849 uhland62
uhland62's picture

They do, read it about Argentina. But these things are not talked about at great lengths because it would hurt McCain's feelings when the minions do something without Uncle's approval. There is a great difference between Uncle and some of the others. Uncle likes grandstanding, talking about it first to make a splash but then not much happens, except for 'destroy first, think later'. Some of the others don't like grandstanding and just do things. You need to look for it in the alternative media, while the grandstanding is always there, everywhere. 

Fri, 11/06/2015 - 03:18 | 6756928 silvermail
silvermail's picture

If today to make set-off of debt of all countries of the world, we get an interesting picture:
The United States will owe money to China, Russia and other powerful countries.
All the weak countries like Romania, Poland and Latvia, will also owe money to China and Russia, but not the United States.
Why is that?
Because the United States is constantly borrow from strong countries and then transmit these money to other countries as a loan in favor of the weaker countries.
Thus, all the weak countries are compelled to support Washington's policy, aimed at blocking the development of powerful countries.

Conclusion: Whenever powerful countries give money to America's debt, they are actually engaged in the financing of economic and political war against themselves.

Fri, 11/06/2015 - 00:52 | 6756716 BlindMonkey
BlindMonkey's picture

I watched "There Will Be Blood" once and though I had the oil man game figured out.  Daniel Day Lewis didn't say anything about trading milkshakes so I'm lost here.  I got nothin'.

Fri, 11/06/2015 - 08:26 | 6757195 nosam
nosam's picture

My milkshake brings all the boys to the yard.

Thats probably a more apt metaphor.

Fri, 11/06/2015 - 00:54 | 6756720 Omega_Man
Omega_Man's picture

good

Fri, 11/06/2015 - 01:09 | 6756754 MEFOBILLS
MEFOBILLS's picture

China is the largest importer of Iranian crude.  It could be another route to get Russian oil to China, and hence strengthen the likely upcoming BRIICS (Brazil, Russia, India, IRAN, China, South Africa).

 

Fri, 11/06/2015 - 01:42 | 6756820 BarkingCat
BarkingCat's picture

That block is really dragging itself down with South Africa.

Fri, 11/06/2015 - 02:23 | 6756873 Kirk2NCC1701
Kirk2NCC1701's picture

Wait till they add 'Eye Rack': BRIIICS.

Fri, 11/06/2015 - 01:16 | 6756765 Atomizer
Atomizer's picture

It's always been about a oil pipeline relationship. We invaded Iraq and Afghanistan. Both pipeline agreements went nowhere. 

We can't even agree on Keystone... Have a look

http://keystone-xl.com/

Stupid fucking people that have no right in presenting the taxpayers of United States. 

John Kerry comes to mind. Many more!  

 

Fri, 11/06/2015 - 02:07 | 6756858 uhland62
uhland62's picture

But the Afghanistan pipeline is still very much in the pipeline, going into China through their tiny bit of common border. It is also easily extendable to the West into Iran. Neighbours trading with each other, that's normal.

Fri, 11/06/2015 - 02:21 | 6756869 Wild E Coyote
Wild E Coyote's picture

No. It is not about oil.
It is always about money.
It does not matter if you get oil. It is bonus.
Primary purpose is always creating expenditure.
Have you seen the billions stolen in Afghan construction effort?

Fri, 11/06/2015 - 05:52 | 6757028 dreadnaught
dreadnaught's picture

how about 99% of Congress

Fri, 11/06/2015 - 01:28 | 6756789 kedi
kedi's picture

There seems to be a Russian pipeline to Baku on the west coast of the Caspian. Just continue it undersea to Iran, then cross country to southern ports.

Fri, 11/06/2015 - 01:36 | 6756804 kaboomnomic
kaboomnomic's picture

Some stupid russian hater comment shows how clueless he is.

And that stupid oilprice.com site as usual, always clueless about russia energy.

First, WHY Russia "so dependent" on Iran oil? It has plenty. Russia does a good business deals with Iran. To access Pakistan? Here's what russian do.
https://www.rt.com/business/318840-russia-pakistan-gas-pipeline/

For India? Here's what russian do.
http://m.firstpost.com/world/modi-putin-to-discuss-40-billion-india-russ...

And you already knows about gas/oil deals between China & Russia right?

All oil & gas from EEU countries is either already bought by gazproms or it uses gazproms pipelines for transport.

- - -

So, Russia needs Iran for access to Asia? My ASS!!

Iran is a long time good friends of Russia alright. And they would get even closer. Once Iran joins BRICS BANK & EEU FREE TRADE ZONE (which interestingly Israel so desperates to join this trades also).

- - -

Russian hater is always so clueless. Better learn to read first. Before you let others knows how clueless you are..

Fri, 11/06/2015 - 01:47 | 6756827 BarkingCat
BarkingCat's picture

If Iran joins BRICS will that make it
BRICSI
BIRICS
BRICIS

Maybe they will kick Brazil out and use Persia instead of Iran which will give us
PRICS

Fri, 11/06/2015 - 02:03 | 6756855 uhland62
uhland62's picture

Barking up wrong tree before dawn.

Fri, 11/06/2015 - 02:18 | 6756867 Wild E Coyote
Wild E Coyote's picture

You found yourselves. Congratulations.
Now focus. It is spelled prick

Fri, 11/06/2015 - 06:26 | 6757055 man of Wool
man of Wool's picture

Seeing as Brazil has gone back to the third world as an economy and South Africa does not even have the largest economy in Africa all that is left of BRICS is RIC. Add Iran and you have RICI.

Fri, 11/06/2015 - 02:38 | 6756889 forputin
forputin's picture

Putin haters are idiots and tha has been proved many times. Like when they didn't believe that Putin will make Greece as it's satelite and soon EU will break apart (very soon... soon enough... ok, some time in near future.. ok, some times in future.. ok ... I don't know), or when that super mega China - Russia gas deal was DONE (ok not yet, no it's postponed) or when that super mega deal Russia- Turkey was done (ok, so it's not done, it's also postponed.. or even close to canseled because of Syria), or that Ukraine will be broke and Novorosija will be there (ok, so that project is closed because of sanctions we can't deal any more). So yes... in your face! Putin haters are idiots!

Fri, 11/06/2015 - 05:51 | 6757027 dreadnaught
dreadnaught's picture

having a higher number of digits on their bodies than their IQs # may have something to do with it, eh pal?

Fri, 11/06/2015 - 02:22 | 6756870 darteaus
darteaus's picture

Axis Powers 9/1/1939: Russia, Germany, Italy, Japan

Axis Powers 9/1/2015: Russia, Iran, China

Fri, 11/06/2015 - 06:04 | 6757040 lakecity55
lakecity55's picture

Axis Powers 2015: USSA, GB, France, Saudis, etc.

Allies 2015: Russia, China, Iran, India, etc.

Fri, 11/06/2015 - 02:32 | 6756883 theyjustcantstop
theyjustcantstop's picture

want some free advice include Iraq in on deals, it's still boing to be important area, and ally.

Fri, 11/06/2015 - 02:33 | 6756884 forputin
forputin's picture

Loved the source of info:

"Where reports suggest"

Wow - thats a good source they have. Now everyone can check it.

So... as much as I love Putins propaganda - I don't understand the logic in this "offer"? What would be intrest for Iran to let in Russian oil that would than take Irans oil export market share? I don't see any point for Iran to do that. But since "reports suggest" - than it must be true! Go Putin! Go oil! Go gas! Go war! Go... whatever!

Fri, 11/06/2015 - 05:58 | 6757036 SoDamnMad
SoDamnMad's picture

With oil pricing so competitive what with discounts by different countries to different regions; whose going to figure out

  how you cost-in different grades and the extra shipping and handling costs. Caspian grades have high sufur content.

Can Iran's refineries process that?  A barrel is not a barrel.   Maybe someone hasn't figured out that a quart of dog-shit flavored

ice cream is not equivalent to a Ben & Jerry's quart (The Tonight Dough)

Fri, 11/06/2015 - 06:06 | 6757041 lakecity55
lakecity55's picture

WasWas: Where is our air support, McPain?

I don't know. Everytime they power up the aircrafts, the electronics go dead.

Fri, 11/06/2015 - 07:50 | 6757145 falak pema
falak pema's picture

when petrodollar smells of roubles.

If you add a T to it it smells of Troubles !

T for two and tea party for the oil guzzlers!

Fri, 11/06/2015 - 09:46 | 6757450 VW Nerd
VW Nerd's picture

Why pipelines?  They're strategically vulnerable and expensive to build and maintain.  Couldn't the two countries set up "oil depositories" in each country and just pump in or out oil into/out of the other country's depository with a ledger entry?  Kind of like gold vaulting between banks.  Seems more efficient since they're both oil producers.

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