Iran drops asking price for oil in Japanese deal

Press, 27 December 1979, Page 6

Iran drops asking price for oil in Japanese deal

NZPA-Reuter Tokyo The National Iranian Oil Company has lowered its offered price for Iranian direct-deal oil to be supplied to Japan in 1980 to an average SUS3O per barrel from the previously requested SUS3S, the Japanese Ministry of International Trade and Industry has said.

The Iranians have also offered to supply about 460,000 barrels a day of direct-deal oil to a total of 13 Japanese firms in 1980, withdrawing its previous proposal to cut its 1980 supply to Japan by 25 per cent, the Ministry says.

It is not known if the move is linked recent American pressure on Japan not to take up Iranian oil released on to the market by tl embargo imposed against Iran by the United States when the embassy hostages were seized in Teheran at the beginning of November. Three Japanese firms which negotiated with the Iranians before the Caracas meeting of the Organisation of Petroleum Exporting Countries in mid-December suspended their talks because of high prices asked by the Iranians, which were' based on a complicated formula based on a price set by the Iranian Government and prices on the spot market, the Ministry says. The Iranians have now

told three other Japanese companies that the price should be about SUS3O a barrel, based mainly on the new standard price of 5U528.50. Japanese firms concerned, which are in no hurry to conclude the deal for Iranian direct-deal oil products covering its needs for 101 days, have not decided what to do about the latest Iranian offer, the Ministry says.

The 13 Japanese firms have been sending their representatives to Teheran in turn in small groups of three companies as reSuested by the Iranians for le negotiations.

Meanwhile, Iraq has notified Japanese oil importers of an increase in oil prices by SUS 4 in two stages, SUS2 retroactive to November 1 and another SUS2 to December 1, the Kyodo News Service has reported, i The new price will be !$L'525.96, an 18 per cent increase from $U521.96 per barrel charged for the Iraqi I light crude.

' In Teheran, the Governor lof the Western Iranian province of Ham has said that Iraq has probably poached oil from Iranian sources. The State radio quoted Governor Hamid Ebrahimi as saying: “Iraq has sunk more than 50 wells which are probably fed by Iranian oil resources.” He said the wells were only 100 metres from the Iranian border. Earlier, the provincial authorities said an attack on the oil installations in Ham by unknown gunmen had been repulsed by Iranian paratroopers. Relations between Iran ano Iraq have been at a low ebb since the February revolution which toppled the Shah. Iran has repeatedly accused Iraq of promoting unrest among the Arab ethnic minority who live in oil-rich Khuzestan province. There is a strong movement among Iranian Arabs to make the province into a separate State called Arabistan.