Iran Reportedly Orders a Virtual Halt to All Imports

The Iranian government has halted virtually all imports because of a sharp drop in its oil exports and dangerously low foreign exchange reserves, diplomats in Tehran said Sunday.

Iranian banking sources confirmed that the central bank last week issued an internal order severely restricting letters of credit for imports.

“All Iran is importing now is food and armaments,” one banking source said.

While Iran does not report its foreign exchange reserves, diplomats speculate that the total could have dwindled to $4 billion. Iran is also refusing to consider any deals that do not include the purchase of its oil under a barter or counter sale arrangement, the sources said.

The tight restrictions were imposed after oil exports slumped in December to a figure estimated by Western oil sources at 1 million barrels a day.

This is about half the peak rate of about 1.9 million barrels a day reached last July and well below the 1.7 million barrels a day that, in the opinion of diplomats, Iran must maintain to achieve its targeted revenue from oil exports of $20 billion for the fiscal year ending in March.

Diplomats attributed the slump in exports mainly to uncertainties in the market and price.