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Sanctions cost Iran $40 bn in 2012, says IEA

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(Globalpost/GlobalPost)

Sanctions by the West on Iran succeeded in slashing Iran's oil export revenue by $40 billion in 2012, the International Energy Agency said on Wednesday, as production last month hit a three-decade low point.

The IEA, the oil monitoring and policy arm of the OECD, said Iranian oil output fell to 2.65 million barrels per day in January, down from the 3.7 mbd in late 2011 before the sanctions imposed on the Islamic Republic by the US and European Union took effect.

"Iranian crude oil production continued to edge lower in January and may fall further in coming months following implementation on February 6 of additional sanctions by the US," the IEA said in its monthly report on the world oil market.

The latest sanctions are part of US legislation adopted last summer and "effectively bar Iran from repatriating earnings from its oil exports, depriving Tehran of much needed hard currency," the agency said.

The US Treasury said earlier this month that countries continuing to buy Iranian oil would have to retain their payment for the oil, and allow it to be used only for Iranian purchases of goods from them.

That has apparently succeeded in tightening Tehran's ability to freely use the money it gets from oil exports, which have already been sharply constricted by international sanctions on the country.

The move on oil revenues came six months after the US said it would deny access to the US financial system to countries buying Iranian oil, with certain countries given exceptions to wind down their trade.

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http://www.globalpost.com/dispatch/news/afp/130213/sanctions-cost-iran-40-bn-2012-says-iea