Boeing Aborts 2 Large Contracts with Iran

June 7, 2018

Source: London – Asharq Al-Awsat

An Iran Air Boeing 747 passenger plane sits on the tarmac of the domestic Mehrabad airport in the Iranian capital Tehran, January 15, 2013. AFP

Boeing will not deliver aircraft to Iran in light of US sanctions, effectively aborting a pair of large contracts with Iranian carriers, a Boeing spokesman said Wednesday.

“We have not delivered any aircraft to Iran, and given we no longer have a license to sell to Iran at this time, we will not be delivering any aircraft,” the Boeing spokesman said.
“We did not factor the Iran orders into our order backlog either.”

The announcement follows President Donald Trump’s decision last month to pull the United States out of the 2015 nuclear accord between Iran and major powers that had cleared the way for a relaxation of sanctions on Iran.

Boeing had previously said it would respect US policy on Iran and had pushed back the delivery dates on the Iran planes without commenting directly on deliveries.

Boeing in December 2016 announced an agreement to sell 80 aircraft valued at $16.6 billion to Iran Air.  It also announced a contract in April 2017 to sell Iran Aseman Airlines 30 Boeing 737 MAX aircraft for $3 billion, with purchase rights for another 30 aircraft.

Meanwhile, trading sources said that European refiners are winding down oil purchases from Iran.

Although European governments have not followed Washington by creating new sanctions, banks, insurers and shippers are gradually severing ties with Iran under pressure from the US restrictions, making trade with Tehran complicated and risky, Reuters said.

“We cannot defy the United States,” said a senior source at Italy’s Saras, which operates the 300,000-barrels-per-day (bpd) Sarroch refinery in Sardinia.

Saras is determining how best to halt its purchasing of Iranian oil within the permitted 180 days, the source said, adding: “It is not clear yet what the US administration can do but in practice we can get into trouble.”

Refiners including France’s Total, Italy’s Eni and Saras, Spain’s Repsol and Cepsa as well as Greece’s Hellenic Petroleum are preparing to halt purchases of Iranian oil once sanctions bite, the sources said.

These refiners account for most of Europe’s purchases of Iranian crude, which represent around a fifth of the country’s oil exports.

Iran’s crude sales to foreign buyers averaged around 2.5 million bpd in recent months, according to data collected by Reuters and EU statistics office Eurostat. The bulk of the exports go to Asia.