Tehran, Beijing to discuss ditching dollar

TEHRAN, Feb. 9 (MNA) – Iran and China will start talks in the coming days to substitute the dollar as the currency used to bilaterally trade oil. The discussions will take place amid a growing number obstacles preventing China from paying for crude imports using the petro-dollar, including the U.S. mandate to punish companies doing business with Iran. China's crude-oil imports from Iran last year were up 30 percent from 2010, to 27.76 million metric tons, according to China's General Administration of Customs – around 557,000 barrels a day. Beijing has steadfastly defended its relationship with Iran, the No. 3 supplier of crude to its energy-hungry economy, as the U.S. and Europe try to increase pressure on Iran over its nuclear activities. The European Union formally imposed an oil embargo on Iran and agreed to a freeze on the assets of the Central Bank of Iran on January 23, but existing contracts will be honored until July 1. In the first half of 2011, China was the largest importer of Iranian crude, followed by Japan, India, South Korea and Italy, according to data from the U.S. Energy Department. China is the top buyer of Iranian oil, accounting for around 20 percent of its total exports, but since January it has cut purchases by around 285,000 barrels per day (bpd), or just over half of the total daily amount it imported in 2011.