China shifts to euros for Iran oil

China's state-run Zhuhai Zhenrong Corp, the biggest buyer of Iranian crude worldwide, began paying for its oil in euros late last year as Tehran moves to diversify its foreign reserves away from U.S. dollars.

The Chinese firm, which buys more than a tenth of exports from the world's fourth-largest crude producer, has changed the payment currency for the bulk of its roughly 240,000 barrels per day (bpd) contract, Reuters reported Beijing-based sources as saying.

Meanwhile, China's Sinopec Corp., Asia's top hrefiner but a minor lifter of Iranian oil, is still paying in U.S. dollars, said a Sinopec trader.

Japanese hrefiners who buy about 500,000 bpd of Iranian crude, nearly a quarter of Iran's 2.2 million-bpd shipments, continue to pay in dollars but are willing to shift to yen if asked, industry sources and officials said separately.

"We are looking at it so that we can switch the currencies any time, but we have not gotten any official requests from the National Iranian Oil Company (NIOC). We are doing the transactions in dollars (now)," an on official with Japan's top hrefiner Nippon Oil Corp. which is one of Iranian crude's buyers has announced.

NIOC head of international affairs Hojjatollah Ghanimifard has said that around 60 percent of its oil income was in non-dollar currencies as almost all of Iran's European clients and some of its Asian customers had agreed to make non-dollar payments.

Iran's shift of currency, being watched closely by foreign exchange traders, comes amid an extended row between Tehran and Washington over Iran's nuclear program.

FK/BG