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Greek Lender Of Last Resort - Iran?

Tyler Durden's picture




 

A fascinating article by Reuters this morning really brings to bear the reality that Greece faces as lenders and trade creditors refuse to help (and why should they realistically) with energy needs. The harsh reality that Iran (yes that nuclearized Iran) is the main provider of Greek oil needs surely puts into perspective what seemingly unlikely events can occur when a person, corporation, country, gets desperate. Perhaps we should reflect the other way that while all the world's bankers and money-men refuse to lend Greece money, Iran has truly become the lender of last resort for Greek survival - as it strikes us that energy needs will/should trump a coupon payment any day.

The near paralysis of oil dealings with Greece, which has four refineries, shows how trade in Europe could stall due to a breakdown in trust caused by the euro zone debt crisis, which is threatening to spread to further countries.

 

"Companies like us cannot deal with them. There is too much risk. Maybe independent traders are more geared up for that," said a trader with a major international oil company.

 

"Our finance department just refuses to deal with them. Not that they didn't pay. It is just a precaution," said a trader with a major trading house.

 

From Reuters: Greece turns to Iranian oil as default fears deter trade

(Reuters) - Greece is relying on Iran for most of its oil as traders pull the plug on supplies and banks refuse to provide financing for fear that Athens will default on its debt.

 

Traders said Greece has turned to Iran as the supplier of last resort despite rising pressure from Washington and Brussels to stifle trade as part of a campaign against Tehran's nuclear program.

 

The near paralysis of oil dealings with Greece, which has four refineries, shows how trade in Europe could stall due to a breakdown in trust caused by the euro zone debt crisis, which is threatening to spread to further countries.

 

"Companies like us cannot deal with them. There is too much risk. Maybe independent traders are more geared up for that," said a trader with a major international oil company.

 

"Our finance department just refuses to deal with them. Not that they didn't pay. It is just a precaution," said a trader with a major trading house.

 

"We couldn't find any bank willing to finance us. No bank wants to finance a deal for them. We missed some good opportunities there," said a third trader.

 

More than two dozen European traders contacted by Reuters at oil majors and trading houses said the lack of bank financing has forced Greece to stop purchasing crude from Russia, Azerbaijan and Kazakhstan in recent months.

 

Greece, with no domestic production, relies on oil imports and in 2010 imported 46 percent of its crude from Russia and 16 percent from Iran. Saudi Arabia and Kazakhstan provided 10 percent each, Libya 9 percent and Iraq 7 percent, according to data from the European Union.

 

"They are really making no secret when you speak to them and say they are surviving on Iranian stuff because others will simply not sell to them in the current environment," one trader in the Mediterranean said.

 

Leading Greek refiner Hellenic Petroleum denied having any difficulty in buying crude and declined to comment on the exact breakdown of oil supplies. Greece's second biggest refiner Motor Oil Hellas declined to comment.

 

Greece's four refineries, belonging to Hellenic and Motor Oil, together can process around 400,000 barrels per day. That figure has fallen to around 330,000 bpd in recent months due to maintenances and upgrades.

 

"Our crude slate is broadly unchanged over the last few months and we are always viewing to optimize our refining operations," a Hellenic spokesman said.

 

"Our supply agreements are based on purely commercial considerations, no other factors interfering," he said.

 

Shipping data obtained by Reuters showed four cargoes taking crude from the Middle East outlet of Sidi Kerir on the Egyptian Mediterranean to Greece in September. Three sailed in October. Traders said all carried Iranian Heavy crude and more was coming in November.

 

"Iran is the only one who might be working on an "open credit" basis right now, given its own difficulty in selling crude," one trader said.

 

Imports of Iranian oil to the United States are subject to sanctions but are still fully legal to Europe and Asia. The European Union said this week it may consider oil sanctions against Iran within weeks, after a U.N. agency said Tehran had worked to design nuclear bombs.

 

Iran denies trying to build atom bombs and an Iranian official, who declined to be named, said Tehran has no difficulty in selling its oil.

 

However, shipping sources said that interest in Iranian crude, which is cheaper than competing Russian grades but politically sensitive, has prompted the country to continue storing crude in the Red Sea, to make it available for swift delivery.

 

The rest of the oil industry drastically cut crude storage last year after forward prices for crude moved to a discount to prompt, making such operation loss-making.

 

Iran is storing crude in four very large crude carriers (VLCCs) in the Red Sea.

 

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Fri, 11/11/2011 - 13:06 | 1870168 TruthInSunshine
TruthInSunshine's picture

From the Athenian 300 to this.

Sounds about right.

Fri, 11/11/2011 - 13:21 | 1870233 tmosley
tmosley's picture

Athenians are callow boy lovers.  It was the Spartans that held back the Persian hoards.

Sadly, all that remain are the Athenians.

Fri, 11/11/2011 - 13:27 | 1870253 TruthInSunshine
TruthInSunshine's picture

I stand corrected.

But what about that bizarre Persian King in the movie, hermaphroditic genitalia and all?

Wasn't Leonidas pure of heart and the movie essentially a historically accurate documentary about the danger of Persians, the immortals, sunburst missiles, and the need to start another MENA conflict with known unknowns and unknown knowns?

I'm going to need some answers pretty soon because I signed up to take the Jesse Livermore (conducted by Barton Biggs & Victor Niederhoffer) Rock Star HFTrader Boot Camp.

Fri, 11/11/2011 - 13:41 | 1870314 redpill
redpill's picture

Our debt is so large it will blot out the sun!

 

Then we will default in the shade!

Fri, 11/11/2011 - 14:27 | 1870442 Ahmeexnal
Ahmeexnal's picture

Black cars look better in the shade.

Fri, 11/11/2011 - 13:29 | 1870256 magpie
magpie's picture

Even back then, there were more Greeks fighting on the Persian side against their own free cities.

Sounds like a pincer move against the Great Turk...not that i would expect such strategems.

Fri, 11/11/2011 - 13:34 | 1870281 LawsofPhysics
LawsofPhysics's picture

We could use a few Spartans about now.  I wonder how a proposal for an asset/commodity-backed trade or currency from Iran to Greece (or any other sovereign) would be recieved by NATO?   As hostile no doubt.  

Iran (speaking to the world);  "We have oil and will trade with anyone for technology or any physical assests, let's see what the E.Z. has to trade."

Later that day on all MSM sites -  "Nuclear accident being reported out of Iran..."

Fri, 11/11/2011 - 15:40 | 1870670 ImNotExposed
ImNotExposed's picture

I guess we'll have to wait until the movie comes out about how the Athenians defeated a Persian force at least 10 times greater than theirs. This battle is still commemorated in cities the world over, many times a year.

Fri, 11/11/2011 - 13:07 | 1870174 Ecoman11
Ecoman11's picture

So Greece will borrow from ECB to buy oil from Iran. Love it.

Fri, 11/11/2011 - 13:12 | 1870193 X.inf.capt
X.inf.capt's picture

WTF!???

can we get this over with, PLEASE!

Fri, 11/11/2011 - 13:16 | 1870221 rocker
rocker's picture

 Tyler looks to be late on this. The FED is making dollars available to the ESFS and the ECB to buy Italian Bonds.

 Being reported on Bloomberg right now. The FED is making dollars available to buy Italian Bonds.  Making Dollars.

Get it, freshly printed to back up verbal commitment from Big Ben.

Fri, 11/11/2011 - 13:47 | 1870326 LawsofPhysics
LawsofPhysics's picture

Prescisely why gold is on the move again.

Fri, 11/11/2011 - 14:14 | 1870396 Doomer
Doomer's picture

What you talkin' 'bout Willis?

Fri, 11/11/2011 - 13:33 | 1870283 Bam_Man
Bam_Man's picture

Money is fungible.

Fri, 11/11/2011 - 13:09 | 1870182 Zymurguy
Zymurguy's picture

Just wait until we bomb Iran... will Greece jump in to defend?

Fri, 11/11/2011 - 13:17 | 1870224 GeneMarchbanks
GeneMarchbanks's picture

Who is this 'we' you speak of?

Fri, 11/11/2011 - 18:13 | 1871084 Tompooz
Tompooz's picture

 

"Who is this 'we' you speak of?"

The US and Disneyland

Fri, 11/11/2011 - 13:10 | 1870187 Caviar Emptor
Caviar Emptor's picture

Greece to become an Iranian satellite. 

Fri, 11/11/2011 - 14:13 | 1870393 reload
reload's picture

Would that not be fantastic - Iran could have some Air Bases, a garrrison or ten of crack ground forces and a Naval Base down on the Kalamata peninsular. They could Blockade Isreal and demand they scrap their Nukes!

Ok, perhaps they would not get away with it.

Sat, 11/12/2011 - 11:18 | 1872026 TruthHunter
TruthHunter's picture

ECB takes the Acropolis

and Hezbollah takes the streets?

Fri, 11/11/2011 - 13:11 | 1870189 rambler6421
rambler6421's picture

This is interesting. 

 

THanks Tyler for posting stuff that the MSM doesn't talk about too much. 

 

 

Fri, 11/11/2011 - 13:12 | 1870195 wrs
wrs's picture

Love the unintended consequences here.  The EU is just showing how it's not possible to control everyone with money.  No doubt Greece has something that Iran wants, that oil isn't supplied simply on credit.

Fri, 11/11/2011 - 15:28 | 1870644 LeZinc
LeZinc's picture

There is no money left to control anybody.

Fri, 11/11/2011 - 13:14 | 1870203 Dick Darlington
Dick Darlington's picture

Expecting Mr Rehn, the ponzimaster of bankrupt Europe, welcoming Iran to join eurozone, the cradle of stabeeletee and prospeeretee not to mention democracy.

Fri, 11/11/2011 - 13:18 | 1870228 GeneMarchbanks
GeneMarchbanks's picture

Would be in line with surreal theme of the past couple of months.

Fri, 11/11/2011 - 13:23 | 1870242 Dick Darlington
Dick Darlington's picture

Surreal indeed.

Fri, 11/11/2011 - 13:40 | 1870311 vocational tainee
vocational tainee's picture

habemus papademos...

 

Fri, 11/11/2011 - 13:13 | 1870206 SheepDog-One
SheepDog-One's picture

This is SPARTA! Still all about oily Greeks and Persians even centuries later.

Fri, 11/11/2011 - 13:16 | 1870223 Dr. Engali
Dr. Engali's picture

Actually the Greeks were thuggish warriors , more like cannon fodder.

Fri, 11/11/2011 - 13:15 | 1870210 Akrunner907
Akrunner907's picture

Iran doesn't need nuclear weapons....the financial fallout will be enough.

Fri, 11/11/2011 - 13:16 | 1870220 SheepDog-One
SheepDog-One's picture

Yea throws a bit of a monkeywrench into the 'attack Iran' endgame.

Fri, 11/11/2011 - 13:16 | 1870219 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

So much for war with Iran.

Fri, 11/11/2011 - 13:19 | 1870230 SheepDog-One
SheepDog-One's picture

Now theyll have to speed up false flag diversion attacks...upscale them too. 

Fri, 11/11/2011 - 15:56 | 1870710 Whoa Dammit
Whoa Dammit's picture

If Greece is trading direct with Iran, it could speed up the war, since someone wouldn't be getting their vig from the trade.

Fri, 11/11/2011 - 13:16 | 1870222 Cultural Capital
Cultural Capital's picture

Change you can believe in http://www.youtube.com/watch?v=jsRP3CnG0e4

Fri, 11/11/2011 - 13:21 | 1870234 Tao 4 the Show
Fri, 11/11/2011 - 13:40 | 1870312 meizu
meizu's picture

why do you think Western media only care about Syria, but not Bahrain and Yemen?  Do you think western nations will sanction Bahrain?

Fri, 11/11/2011 - 13:32 | 1870276 wang (not verified)
wang's picture

as the the ECB's S-92 is on the pad and ready to go

Fri, 11/11/2011 - 13:27 | 1870258 jcaz
jcaz's picture

....Andddddd.... Iran buys Greece for $3B.....

Fri, 11/11/2011 - 13:30 | 1870267 Bam_Man
Bam_Man's picture

If the Greek economy continues on its current trajectory for any legnth of time, they will not be needing oil from anybody. Problem solved.

Fri, 11/11/2011 - 13:32 | 1870275 Mercury
Mercury's picture

Oh! curveball - a Greek/Persian alliance!

Fri, 11/11/2011 - 13:33 | 1870279 navy62802
navy62802's picture

I guess their oil is gonna stop after Israel attacks. Oops.

Fri, 11/11/2011 - 13:33 | 1870280 navy62802
navy62802's picture

Double post.

Fri, 11/11/2011 - 13:56 | 1870347 lolmao500
lolmao500's picture

Trilateral commission controls Greece. It's all planned that Greece does business with Iran.

Fri, 11/11/2011 - 14:10 | 1870383 Nobody For President
Nobody For President's picture

As an interesting sidenote, Greece owns more of the world's oil tankers by far than any other nation. (733)

http://en.wikipedia.org/wiki/Tanker_(ship)

 

Maybe they will ask them to all come home - loaded.

Fri, 11/11/2011 - 14:19 | 1870415 Socratic Dog
Socratic Dog's picture

Hmm.  That true?  Well, I hear those rotten Greeks are nuclearizing.  Time to do something about that.  Impound assets maybe?

Fri, 11/11/2011 - 14:11 | 1870384 Bam_Man
Bam_Man's picture

"Oil's Well That Ends Well"

Fri, 11/11/2011 - 14:35 | 1870475 Beau Tox
Beau Tox's picture

Xerxes still exacts revenge for Thermopylae.

Fri, 11/11/2011 - 15:15 | 1870608 JOYFUL
JOYFUL's picture

G-Pap signed a (not so) secret military alliance pact with israel in September, as a result of which the sionists have full access to air bases and ports for working around the problem of the Turks denying them right of passage for the hit on Iran. 

The  Greeks got a mess of armaments in return, but were supposed to also have got the $ necessary to stave off bankruptcy as well....except that G-Daff got the gold out of country before they finally took him down, so the promised payments via stolen Libyan gold never transpired...although the shuffling of the general staff went through as planned.

The israelis snuck the necessary planes through to Azerbijan via exercises in Turk airspace: but to move the required 'bunkerbusters' that Obomber gave them to those aircraft, they need to follow the Greece(probably Rhodos)Romania, Georgia transit that the Sept deal was supposed to ensure.

Talk of 'tranche payments,' meeeting conditions, and so on is just smoke and mirrors...Berlusconi and G-Pap are both collateral damage victims of the non-appearance of the Libyan loot...Nato, er ZATO, sorry, I meant to say, Tel Aviv, is forced to ramp up the first strike scenario because they know that the Greeks are going to call them on the missing cash soon, revoke the deal, and go with the Persians instead. 

 

Look for a strike before Thanksgiving...it's all or nothing now.

Fri, 11/11/2011 - 17:51 | 1871027 Mary Wilbur
Mary Wilbur's picture

@Joyful  What are your sources?

Fri, 11/11/2011 - 15:13 | 1870611 americanspirit
americanspirit's picture

What's really funny about this is that Greece has just cut a deal with Israel to allow the Israeli Air Force to base attack aircraft at Greek air force bases, where they will presumably be refueled by jet fuel refined from oil from .... Iran.

Fri, 11/11/2011 - 15:31 | 1870655 ImNotExposed
ImNotExposed's picture

Funny, because Libya was set to invest E200,000,000,000 in Greece. Then Libya got creamed.

Fri, 11/11/2011 - 15:37 | 1870666 LawsofPhysics
LawsofPhysics's picture

Hhhmmmm.  Hyopthetically, if any of the M.E. nations were to fund insolvent E.U. nations wouldn't that cause the world to deal with the next largest slovency problem, the United States?  All I can say is it seems like the U.S. has a vested interest in keeping all eyes on Europe.

Fri, 11/11/2011 - 17:40 | 1870999 jonjon831983
jonjon831983's picture

Here's something Greece can pay Iran with: weapons?

 

 

Less healthcare, but Greece is still buying guns Greeks furious at 'intact' arms spending as eurozone leaders insist on cuts to their public services

 

http://www.independent.co.uk/news/business/analysis-and-features/less-healthcare-but-greece-is-still-buying-guns-6257753.html

 

(Not saying they are/will/would.)

Fri, 11/11/2011 - 20:30 | 1871316 MS7
MS7's picture

Interesting theory... We in the US know a little something about selling arms to Iran. In case the plan gets out, say "I do not recall" to every question and let an Ollie North type take the fall.

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