These lengthy waivers were granted in the hope of bringing Baghdad back towards the U.S.’s side in the geopolitical power play with China and Russia going on across the Middle East, an opportunity Washington looked to leverage when al-Kadhimi visited Washington last August. “Instead, it looks like Baghdad is just trying to see if it can start playing its usual game with the new U.S. government from the beginning all over again by sending this signal that it is open to offers from Washington during this suspended relationship period with Beijing, ” he concluded. The game is very simple but nonetheless very effective: Baghdad sends a signal that it may move even closer to Iran or to Russia and China through various oil field awards or other contracts and the U.S. feels compelled to counter with the offer of more funding directly or indirectly through massive deals between U.S. firms and Iraqi ones. China aims to assure the Iranian government that it has Beijing’s support as a strategic ally - a vital assurance amid China’s increasing demands for oil. The US$2 billion five–year prepayment oil supply deal between the Federal Government of Iraq (FGI) in Baghdad and China’s Zhenhua Oil deal was announced with … The real reason is rising oil prices. China Prepares To Close ‘Oil Deal Of A Lifetime’ In Iraq Credit: Robert Lucian Crusitu/Shutterstock Over the past week or so, China has eased quarantine measures in Wuhan – the city in which the global coronavirus pandemic began – with the entire lockdown scheduled to end on 8 April. Oil Workers Move To Renewable Jobs, But The Pay Is Lower, 3 Ways To Play The Next Commodity Supercycle. China and Iran are rumored to be finalizing a $400 billion deal which would deepen economic, political, and militarily ties between two of America's chief adversaries. Related: OPEC+ Decision To Raise Output Could Keep U.S. Biden's $2 trillion Plan for Insfrastructure and Jobs, European gas market to 2040 according to Platts Analitics, America's pandemic dead deserve accountability after Birx disclosure. Will U.S. Shale Trigger Another Oil Price Crash? China’s Zhenhua Oil Co., a subsidiary of defense contractor Norinco, won the bid, Bloomberg reported in December. OPEC’s second-biggest producer had wanted as much liquidity as possible in January and February this year and was concerned that oil prices wouldn’t exceed $40 a barrel, Jabbar said in his interview. Photographer: Haidar Mohammed Ali/AFP/Getty Images. The Hindu leaders Tagore and Gandhi and Muslim Jinnah both discussed the war with the Chinese Muslim delegation under Ma Fuliang while in Turkey İsmet İnönümet with the Chinese Muslim delegation. Iraq and China to sign massive financing deal Imminent agreement will provide some $10 billion in credit for companies to invest, super-charging China's involvement in the Iraqi economy. Any trading and execution of orders mentioned on this website is carried out by and through OPCMarkets. China Prepares To Close ‘Oil Deal Of A Lifetime’ In Iraq By Simon Watkins for Oil Price Over the past week or so, China has eased quarantine measures in Wuhan – the city in which the global coronavirus pandemic began – with the entire lockdown scheduled to end on 8 April. “Even in Iraq, long-running oil contracts – including prepayment ones – do not consist of a single rigid figure but rather the reference price for the oil sold is based on a rolling mean average, perhaps over the previous three months, or six months, or maybe even a bit longer, which would automatically factor in a rising price trend or a falling price trend as the base price point, so this explanation makes no sense,” a senior oil and gas figure with close connections to Iraq’s Oil Ministry told OilPrice.com last week. Ma Fuliang and Isa were working for Zhu Jia… Iraq then takes the money and the contracts and continues to do what it was going to do anyway, which is to remain firmly on the side of neighbour Iran whose grip over the country is interwoven into its very fabric through political, economic, and military elements. China, Iran unite over oil deal while US worries (Full show) 16 Mar, 2021 20:12 . The US$2 billion five–year prepayment oil supply deal between the Federal Government of Iraq (FGI) in Baghdad and China’s Zhenhua Oil deal was announced with great care and attention to timing just after former President Donald Trump had lost the 2020 Presidential Election. In an interview with the Iraq Oil Report earlier this month, Allawi said pre-payment oil deals were problematic because they required a sovereign guarantee. Iraq has reportedly " put on hold " it oil contract with China's Zhenhua Oil. CO2 Mitigation on Earth and Magnesium Civilization on Mars – Just Add Water, Simple question: What is the expected impact in electricity Demand when EV deployment exceeds 10%, U.S. Presidential Elections Status - Electoral Votes. What is Oil Prepayment System? Baghdad opted not to go ahead after oil prices rose in recent months, Oil Minister Ihsan Abdul Jabbar told BBC Arabic on Sunday. Related Posts. Iraq Decides Against Oil-Supply Deal With China’s Zhenhua Finance minister Allawi says contract has been ‘deferred’ Deal would have provided cash-strapped Iraq with $2 billion Oil-hungry China has cultivated close economic ties with Iraq. After prices stabilized, “we decided to freeze this attempt or option and we didn’t activate it,” BBC Arabic cited him as saying. China Iran Iran deal Iranian revolution oil Soviet Union Tehran. Becoming the first foreign firm to enter such an agreement since the end of Saddam Hussein's regime, state-owned China National Petroleum Corp. (CNPC) this week won the right … However, at the time Brent crude price was $40 a barrel. RT America's Alex Mihailovich reports on the Chinese stake in easing tensions between Washington and Tehran. Chinese Muslims fought against Japan in World War II. The official explanation as to why this US$2billion+ prepayment deal with China has been paused was ludicrous, even by Iraq’s standards – basically, that the deal was predicated on oil prices remaining at the low end but with oil prices more stable and perhaps rising that the deal could not go ahead. Gasoline Under $3. Iraq and a Chinese oil major have just struck a $2 billion deal in a move that will ensure the two nations will have strong energy ties for years to come This was in line with the collapse in oil prices and the fact that about 90 per cent of Iraq’s government revenues still come from oil exports. China Prepares To Close “Oil Deal Of A Lifetime” In Iraq Authored by Simon Watkins via OilPrice.com, Over the past week or so, China has eased quarantine measures in Wuhan – the city in which the global coronavirus pandemic began – with the entire lockdown scheduled to end on 8 April. Merchant of Record: A Media Solutions trading as Oilprice.com. Predictably enough, and presumably as soon as the initial funds involved in the pre-financing of these deals had hit the Iraq government’s accounts in the Central Bank of Iraq, Baghdad turned around and announced that it had just signed the longest ever deal with Iran to continue to import electricity and gas from it for at least the next two years, although this could be extended with ease. Prepayment deals are rare in the oil world and this was meant to improve Iraq’s financial situation. 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Within just a month of the al-Kadhimi visit to Washington, the Trump Administration had lost all patience with Baghdad, with one senior White House source having told OilPrice.com: “We’ve been down this road before with Pakistan – [with] the government pretending to help in the fight against AQ [Al-Qaeda] but at the same time the ISI [Inter-Services Intelligence] offering all the help it could to [Osama] bin Laden and we’re not playing that game again.” Subsequently, instead of the rolling 90- or 120- day waivers granted by Washington for Iraq to continue to import Iranian electricity and natural gas in the past, Washington granted a waiver of just 30 days and, at the same time, announced new sanctions against 20 Iran- and Iraq-based entities that were cited as funnelling money to Iran’s Islamic Revolutionary Guards Corps’ (IRGC) elite Quds Force. Iraq has decided against signing an oil-supply deal with a Chinese state company that would’ve seen the cash-strapped Arab nation get about $2 billion upfront. The multi-billion-dollar agreement would have seen Zhenhua pre-pay Iraq's State Oil Marketing Organization (SOMO) for a regular supply of crude oil. Netanyahu’s desperation could prompt him to sabotage the Vienna talks to restore the Iran nuclear deal. This deal was always going to be a test for new President Biden for three key reasons. 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Bernard Madoff, Mastermind of Giant Ponzi Scheme, Dies at 82, Chinese Hedge Fund Jumps 258% After Dumping Ray Dalio’s Strategy, Are China’s Covid Shots Less Effective? He was Head of Forex Institutional Sales and Trading for…. Follow RT on. Updates with finance minister’s comments in second paragraph. Iraq, whose economy is reeling after last year’s crash in crude prices, in November asked oil traders to bid for a five-year supply deal. While the government is still struggling, its position has improved because oil prices have soared 65% since the start of November to around $64 a barrel, largely thanks to the roll-out of coronavirus vaccines. The contract has been “deferred until further notice,” Finance Minister Ali Allawi said in an interview, without giving more details. Iraq signs $3 billion oil deal with Chinese national oil company Deal is first major contract with foreign company since fall of Saddam Hussein China National Petroleum Corporation to … The U.S. immediately rewarded this promise with the firming up of in-principle agreements made with five U.S. companies – Chevron, General Electric (GE), Honeywell International, Baker Hughes, and Stellar Energy - just before al-Kadhimi’s arrival in Washington, worth at least US$8 billion. Read more: China Set to Bail Out Iraq With Multibillion-Dollar Oil Deal. China hailed a three-billion-dollar oil agreement with Iraq as a win for both nations. (Bloomberg) -- Iraq has decided against signing an oil-supply deal with a Chinese state company that would’ve seen the cash-strapped Arab nation get about $2 billion upfront. China and Russia have called on the US to restore the deal by lifting sanctions, while traders and analysts say Iran’s oil exports to China have significantly increased in March despite US warnings. Finance minister Allawi says contract has been ‘deferred’, Deal would have provided cash-strapped Iraq with $2 billion. Consequently, al-Kadhimi arrived in Washington and told the politicians, including Trump’s team, exactly what they wanted to hear in terms of Iraq’s intention to reduce its dependence on Iran for the crucial electricity and gas imports. With Trump’s departure from office, Baghdad moved ahead with the even more inflammatory deal with China’s Zhenhua Oil. The materials provided on this Web site are for informational and educational purposes only and are not intended to provide tax, legal, or investment advice. Internally, the agreement can be an economic lifeline for Iran, saving its sanctions-hit, cash-strapped economy by ensuring the sale of its oil and gas to China. Nothing contained on the Web site shall be considered a recommendation, solicitation, or offer to buy or sell a security to any person in any jurisdiction. The Saudi-instigated oil price in the second quarter of 2020 had pushed Baghdad’s already perilous state finances more firmly into the red, with its oil-related revenues having fallen by nearly 50 per cent at that point. Baghdad proposed delivering 4 million barrels a month, or about 130,000 a day, with the buyer paying upfront for one year of supply. With a new man in the White House, Iraq’s Prime Minister, Mustafa al-Kadhimi, appears to believe that Iraq can begin a completely new cycle of playing off the U.S. against China and Russia, as it has been doing since the first U.S. invasion of Iraq in 2003. Biden about to face first real test. Trading and investing carries a high risk of losing money rapidly due to leverage. The $7 Trillion Reason Saudi Arabia Is Cutting Oil Production, Many Drilled U.S. Wells Will Never Be Completed, Qatar Could Throw A Wrench In America’s Ambitious LNG Plans, The King Of Oilfield Services Is Back In A Big Way. At that time, al-Kadhimi was desperate for money. When Iraq announced in December the $2 bn five-year prepayment oil supply deal with China’s Zhenhua Oil Co, it was very desperate for money to pay State sector employees’ salaries. Its finances were further negatively affected by the enduring effects of the COVID-19 pandemic and by ongoing arguments with the government of the Iraq Kurdistan region over oil-for-budget disbursements. They cheer for helping people while stabbing them in the back!!! Baghdad opted not to go ahead with the contract after oil prices rose in recent months, Ihsan Abdul Jabbar said in an interview with BBC Arabic. Second, the deal between Russia’s Rosneft and the government of Kurdistan meant that Moscow was able to cause such disruption in the budget payments-for-oil deal between Kurdistan and Baghdad that the resulting financial crunch for the FGI pre-disposed Baghdad to look beneficially at the China proposal in the first place. Iran & China Sign Massive 25-Year Deal: $400BN Chinese Infrastructure Investment For Oil Increasingly it appears that so-called “rogue states” and those under Washington’s wrath and sanctions are coming together to combat US dominance across the globe. Foreign Policy. Individuals should consider whether they can afford the risks associated to trading. U.S. and Chinese investors to buy Saudi pipelines , $10 Billion deal. Why Iraq has paused its Oil Prepayment deal with China? That email address is already in the database. And third, it meant that China was directly testing Biden’s ability to separate trade considerations from security considerations – as Trump frequently traded the latter off for the former – to see what the new U.S. President’s reaction will be, particularly given that Zhenhua Oil is an ‘in your face’ arm of China’s defence contractor Norinco. China and Iran signed a deal over the weekend that their foreign ministers said was designed as a strategic partnership to last for the next quarter of a century. Officials from the Iraqi Oil Ministry and the China ZhenHua Oil Company sign a contract to develop part of the East Baghdad oil field on May 23, 2018 - one of Iraq's many energy projects involving Chinese companies. This was followed most notably by 30 107-mm Russian-made Katyusha rockets being fired at the U.S. allied Camp Taji military base north of Baghdad, killing three service members, and at least 15 further attacks on U.S. military and neo-military personnel (and those of its allies) in Iraq by Iran proxies over the following few months, according to U.S. military sources. Experts Size Up Sinovac, Coinbase’s Whipsaw Debut Takes It Past $100 Billion, Then Back, J&J Blood-Clot Pause Done to Educate Doctors, Monitor Cases. This cash crunch in the first half of 2020 could not have come at a worse time for al-Kadhimi as, in the following weeks, he would need to come up with at least IQD12 trillion (US$10 billion) just to pay the next two months salaries of more than four million employees, retirees, state beneficiaries, and the food relief for low-income families. In 2018, Iraq aimed to supply China with more crude oil in another deal that nearly passed but was struck down at the eleventh hour. Trump and his team had started his tenure out playing the usual game with Iraq, granting the country waivers to continue to import electricity and gas for power generation from Iran – despite U.S. sanctions on the Islamic Republic – for periods of two, three or even four months each time. Following the withdrawal of the US from the Iran nuclear deal and introduction of sanctions in 2018, Tehran lost most of its oil trade clients, but, according to unconfirmed media reports, some minor refineries in China have continued to buy crude in secret despite the threat of American sanctions. Newspapers in China reported the visit. Before it's here, it's on the Bloomberg Terminal. According to the U.S., these 20 entities were exploiting Iraq’s dependence on Iran as an electricity and gas source by smuggling Iranian petroleum through the Iraqi port of Umm Qasr and money laundering through Iraqi front companies, among other sanctions-busting activities. Iraq has decided against signing an oil-supply deal with a Chinese state company that would have seen the cash-strapped Arab nation get about $2 billion upfront, according to its oil minister. Will Joe apologize to Putin for calling him a "Killer" ? In order to gain backing for China in Muslim countries, Egypt, Syria, and Turkey was visited by Hui Muslim 馬賦良 Ma Fuliang and Uyghur Muslim Isa Yusuf Alptekin in 1939. Iran, China sign strategic long-term cooperation agreement. Start Trading CFDs Over 2,200 Different Instruments, Simon Watkins is a former senior FX trader and salesman, financial journalist, and best-selling author. First, the deal is straight out of the playbook that Russia used in 2017 to gain control over Kurdistan, Iraq’s semi-autonomous northern region. Does .001 of Atmosphere Control Earth's Climate?! These groups together constitute the majority of households in Iraq and it was rightly believed in senior Iraq government circles that any failure to pay any of these obligations could result in the sort of widespread protests, violence, and death that occurred at the end of 2019. Gasoline Under $3, as Trump frequently traded the latter off for the former, Why Big Oil Expects Record Cash Flow In 2021, U.S. Oil Production Fell To 11 Million Bpd In December, One Of The World’s Oldest Oil Companies Looks To Stage A Comeback. China has moved to significantly increase its purchases of Iranian oil, much to the consternation of the US and its allies. Russia building up military on Ukraine border. Iraq has decided to freeze its first crude oil prepayment deal, which had aimed to boost its finances, because oil prices are rising, the country's oil minister told BBC Arabic on Sunday. Oh the Dems!!! Texas forced to have rolling brown outs. Not from downed power line , but because the wind energy turbines are frozen. The contract has been “deferred until further notice,” Finance Minister Ali Allawi said in an interview, without giving more details. Oil prices have risen significantly since the deal was struck. At the same time, the periodic attacks on U.S. military targets in Iraq continued to go effectively unanswered by Baghdad, which had begin 2020 with Iranian surface-to-surface missiles hitting two Iraqi military bases housing U.S. troops. China Set to Bail Out Iraq With Multibillion-Dollar Oil Deal State-owned ZhenHua is said to win bid for prepayment contract Five-year deal still needs final approval from prime minister New Chinese Coal Plants Equal All those in U.S.A. 74-89% of retail investor accounts lose money. (Bloomberg) -- Iraq is poised to sign a multibillion-dollar contract with China ZhenHua Oil Co., a bailout from Beijing for the cash-strapped government which will … Iran and China have quietly drafted a sweeping economic and security partnership that would clear the way for billions of dollars of Chinese investments in energy and … These factors forced Baghdad into proposing delaying foreign debt payments, introducing salary cuts of 60 per cent for various state sector employees, and reducing all non-essential spending. Today Biden calls for Summit with Putin. In any event, Iraq’s announcement last week that it has put on hold its controversial and massive oil prepayment deal with China’s state-owned Zhenhua Oil Co. falls precisely into this long-established game with the U.S.
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