Iran to Receive 300 mcm of Russian Gas Daily

Iranian flag - Reuters/File Photo
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Iran to Receive 300 mcm of Russian Gas Daily

Iranian flag - Reuters/File Photo

Iran will receive 300 million cubic metres of Russian gas daily, the official IRNA news agency reported Iran's oil minister Javad Owji as saying on Wednesday.

Russian energy giant Gazprom signed a memorandum in June with the National Iranian Gas Company to supply Russian pipeline gas to Iran.

"We currently produce between 840 to 850 million cubic metres per day of natural gas in Iran. Under the agreement, 300 million cubic metres of gas per day will be transferred from Russia through the Caspian Sea," Owji said, adding that the cost of creating the necessary infrastructure would be borne by Russia, according to Reuters.

As part of the 30 year agreement, any surplus Russian gas not used domestically by Iran will be exported to other countries, Owji said, adding the annual value of the contract ranges between 10 billion to 12 billion dollars.

Gazprom has seen its gas supplies to Europe, once the source of two thirds of its gas sales revenue, plummeting to post-Soviet lows over the conflict in Ukraine. Last year it incurred losses of almost $7 billion, its first annual loss since 1999.

The amount supplied to Iran would translate into around 110 billion cubic metres of gas supply per year, on par with the combined capacities of Nord Stream 1 and Nord Stream 2 pipelines -- a total of four pipelines laid on the bed of the Baltic Sea from Russia to Germany. Three were damaged by blasts in September 2022 and one remains unscathed.

Iran sits on the world's second-largest gas reserves after Russia, and Moscow has long sought to make inroads into its natural gas business. US sanctions have hindered Iran's access to technology and slowed the development of its gas exports.

 

 

 

 

 



Dollar Tumbles as Investors Seek Safe Havens after US Tariffs

US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
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Dollar Tumbles as Investors Seek Safe Havens after US Tariffs

US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

The dollar weakened broadly on Thursday, while the euro rallied after President Donald Trump announced harsher-than-expected tariffs on US trading partners, unsettling markets as investors flocked to safe havens such as the yen and Swiss franc.

The highly anticipated tariff announcement sent shockwaves through markets, with global stocks sinking and investors scrambling to the safety of bonds as well as gold.

Trump said he would impose a 10% baseline tariff on all imports to the United States and higher duties on some of the country's biggest trading partners.

The new levies ratchet up a trade war that Trump kicked off on his return to the White House, rattling markets as fears grow that a full-blown trade war could trigger a sharp global economic slowdown and fuel inflation, Reuters reported.

The dollar index, which measures the US currency against six others, fell 1.6% to 102.03, its lowest since early October.

The euro, the largest component in the index, gained 1.5% to a six-month high of $1.1021.

Trump has already imposed tariffs on aluminium, steel and autos, and has increased duties on all goods from China.

"Eye-watering tariffs on a country-by-country basis scream 'negotiation tactic', which will keep markets on edge for the foreseeable future," said Adam Hetts, global head of multi-asset and portfolio manager at Janus Henderson Investors.

The risk-sensitive Australian dollar added 0.56% to $0.63365, while the New Zealand dollar climbed 0.9% to $0.5796.

The yen strengthened to a three-week high against the dollar and was last up 1.7% at 146.76 per dollar, while the Swiss franc touched its strongest level in five months at 0.86555 per dollar.

"Negotiations are now going to be front of mind. This is probably the other big part of why we're seeing some of these currencies outperform," said Nicholas Rees, Head Of Macro Research at Monex Europe.

"It's very difficult actually to see how other countries make concessions that would encourage the US to lift these tariffs. And I think that's a big underpriced risk."

Investors are worried that some US trading partners could retaliate with measures of their own, leading to higher prices.

EU chief Ursula von der Leyen described the tariffs as a major blow to the world economy and said the 27-member bloc was prepared to respond with countermeasures if talks with Washington failed.

Worries about a global trade war have intensified since Trump stepped into the White House in January, combining with a slew of weaker-than-expected US data to stoke recession fears and undermine the dollar.

The dollar index is down more than 5.7% this year.

"These tariffs have certainly significantly increased the risks to the downside for global growth, so on balance we think that will eventually start to become more supportive again for the dollar," said Lee Hardman, senior currency analyst at MUFG.

In Asia currencies, China's onshore yuan slid to its weakest level against the dollar since February 13. China's offshore yuan also hit a two-month low.

The Vietnamese dong slumped to a record low.

Elsewhere, the Mexican peso and Canadian dollar strengthened.

Canada and Mexico, the two largest US trading partners, already face 25% tariffs on many goods and will not face additional levies from Wednesday's announcement.