BEFORE EUROPE TAKES ANY MEASURES Iran intends to block EU exports to the EU

• The IMF: The price of oil could rise to 140 dollars/barrel

The Iranian parliament is preparing a law which could prohibit oil exports to Europe immediately, in response to the embargo which the EU announced on Monday against Tehran.

"If the law gets approved, then the government of Iran will stop any sales of oil to Europe before the embargo goes into effect", said Emad Hosseini, spokesperson of the Energy Commission of the Iranian Parliament. The draft law will be debated in the Parliament on January 29th, said Hosseini.

We remind that earlier this week, the EU decided it would impose a gradual embargo on imports of crude from Iran, thus looking to prevent the funding of the nuclear program of the country. The Europeans have decided to impose an immediate embargo on new contracts for the acquisition of oil and oil products from Iran, and the existing contracts will be executed until the end of June. Thus, starting with July 1st, the EU will no longer buy any Iranian oil.

Iran sells approximately 20% of its oil to the European countries, especially Italy, Spain and Greece.

The International Monetary Fund (IMF) warned that the sanctions against Iran could cause the price of oil to rise by about 20-30%, to 140 dollars/barrel, if no alternative sources for supplying oil are found.

The representatives of the IMF said: "The halting of the oil exports from Iran to Europe, the finding of other sources, will generate an initial rise of 20-30% of the price of oil. In time, the supply of crude oil by other producers or the release of emergency stocks will assuage the situation".

Iran is the second largest producer of oil in the Organization of Petroleum Exporting Countries (OPEC), with 4 million barrels of oil/day. About 80% of the revenues of Iran on the oil segment come from exports. In the first six months of 2011, the European Union bought 450,000 oil barrels/day from Iran, according to the US Department of Energy.