Royal Dutch Shell is struggling to pay off $1 billion that it owes Iran for crude oil because European Union and U.S. financial sanctions now make it almost impossible to process payments, industry sources said.
Four sources said the oil major owes a large sum to the National Iranian Oil Co (NIOC) for deliveries of crude, with one putting the figure at close to $1 billion. A debt of that size would equate to roughly four large tanker loads of Iranian crude or about 8 million barrels.
"Shell is working hard to figure out a way to pay NIOC," said an industry source, who requested anonymity. "It's very sensitive and very difficult. They want to stay on good terms with Iran, while abiding by sanctions."
A Shell spokesman declined to comment.
The European Union toughened financial sanctions and placed a ban on Iranian oil imports on January 23, but gave companies until July 1 to wind down their existing business.
With daily contract volumes of 100,000 barrels, Shell ranked as Iran's second biggest corporate client - along with France's Total - behind Turkey's Tupras.
Shell CEO Peter Voser said on March 7 the company would take its final deliveries of Iranian crude "within a matter of weeks".
Rigorous U.S. and European financial measures, aimed at punishing Iran for its nuclear program have already come into force, making it increasingly difficult to pay for and ship crude from Iran, say oil executives.
"There are big frustrations with the payment route - the U.S. pressure is really working," said a senior oil source. "It's now nearly impossible to use the banking system."
Such financial restrictions were in part behind Total's decision to stop purchasing Iranian crude at the end of last year, industry sources say. Total also bought about 100,000 barrels per day from Tehran.
http://www.reuters.com/article/2012/03/25/us-shell-iran-idUSBRE82O07420120325
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