ERBIL, Kurdistan Region – Iran has struck a bartering deal with South Korea to continue oil exports while avoiding United States sanctions, state media reported.
“According to the plan, goods will be given to Iranian importers and their price will be subtracted from the price of the oil exported to South Korea, and the importers will pay the price of the goods to the Iranian government,' Hossein Tanhaee, head of the Iran-South Korea Joint Chamber of Commerce, told IRNA on Saturday.
South Korea was granted one of eight waivers by Washington, giving it an extra 180 days to wean itself off of Iran’s oil before being subject to US sanctions. South Korea was one of the top buyers of Iranian crude, but it stopped imports in anticipation of the sanctions.
Tanhaee said that their respective private sectors can barter via this new mechanism – a joint fund – even if transactions at the central bank level are impossible.
Seoul has not immediately commented on the deal.
The main items traded between Iran and South Korea are Iranian oil and petrochemical products and Korean household appliances. Tanhaee said they could expand this with Iran exporting food, lead, and zinc and importing paper and cosmetics.
The US imposed sanctions on Iran’s oil sector earlier this month after withdrawing from the nuclear deal in May. The administration of Donald Trump has labelled Iran a state sponsor of terror and wants to curtail Tehran’s regional activities.