Iran has $100 bln abroad, can draw $4.2 bln -US official

Fri Jan 17, 2014 11:34am GMT

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* Implementation of Iran nuclear agreement to start on Monday

* Iran to receive some sanctions easing for curbing nuclear work

* U.S. says too early for businesses to return to Iran

By Fredrik Dahl

VIENNA, Jan 17 (Reuters) - Iran has about $100 billion in foreign exchange assets around the world, of which it will be able to draw $4.2 billion under last year's nuclear agreement with six world powers, a senior U.S. administration official said on Friday.

The official, who spoke on condition of anonymity, said the money and assets were held in various countries and that a significant proportion was Iran's oil revenue. Financial and other sanctions have meant that Tehran has not had free access to spend it.

Under the Nov. 24, six-month accord between Iran and the major powers, Tehran will receive limited sanctions relief, which the U.S. estimates to be worth about $7 billion, in return for curbing its disputed nuclear programme.

Of this amount, $4.2 billion is in the form of access to currently blocked Iranian revenue held abroad.

The U.S. official said Iran would identify from where it wants to take the funds and that the Western authorities would facilitate their transfer in a series of instalments during the next half year, depending on the Islamic Republic carrying out its part of the deal.

The interim accord - meant to buy time for negotiations on a final settlement of the decade-old nuclear dispute - also pauses Western efforts to further cut Iran's oil exports, which Washington says have plunged by around 60 percent to 1 million barrels per day since early 2012.

The U.S. official made clear that the volume would not increase if the oil price were to fall during the six-month agreement, the implementation of which is due to start on Monday.

Japan, South Korea, China, India, Taiwan, and Turkey are still importing Iranian oil, and the official said that if another country started purchasing crude from Tehran it would likely violate U.S. law.

US WARNS AGAINST IRAN BUSINESS

The official reiterated U.S. concerns about a recent Reuters report that Iran and Russia are negotiating an oil-for-goods swap worth $1.5 billion a month. Such a deal would significantly boost Iran's oil exports.

The administration official also underlined the U.S. view that businesses should not rush to return to Iran, saying the sanctions relief under the Geneva agreement was both limited and reversible.

European companies are sizing up the potential of an end to the economic isolation of Iran, attracted by an urgent need to overhaul its creaking infrastructure, a young population of 76 million and major oil and gas reserves.

Reuters reported this week that Belgian chemical firm Tessenderlo will ship fertiliser to Iran within weeks as the easing of Western financial sanctions has helped Tehran complete its first potash tender purchase in two years.

Sanctions imposed by the United States and its allies over Iran's controversial nuclear programme did not ban the supplying of fertiliser to the country.

But measures that have isolated Tehran from most of the global banking system have significantly limited its trading, shipping and payments over the past two years.

The administration official said it would not be good business to begin re-engaging with Iran now, because sanctions still made it very difficult to carry out transactions with the country and receive or make payments.

Iran rejects Western allegations that it has been seeking to develop the capability to make nuclear bombs.

But last year's election of a relative moderate, Hassan Rouhani, as Iranian president paved the way for a diplomatic thaw with the West, which led to the Geneva accord.

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