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UK blocks Shell paying Iran oil debt in food, medicine

Published on Apr 22, 2013 8:51 PM

LONDON (REUTERS) - Britain has blocked efforts by oil major Royal Dutch Shell to settle a US$2.3 billion (S$3 billion) debt it owes Iran by paying in kind with grains or pharmaceuticals, industry sources said.

Shell has been trying for months to find a way to work around international sanctions that prevent it paying in currency for crude it bought from the National Iranian Oil Company before a European Union embargo on Iran that started last July.

The sources said the British government was reluctant to provide relief for the Iranian economy when Western powers are using sanctions to apply financial pressure on Teheran to dismantle its nuclear programme.

"The view is that doesn't make sense to smooth the way for a payment that helps Iran when government is trying to press Iran to negotiate," said an industry source.

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