LONDON - Oil major Royal Dutch/Shell is seeking to work around international sanctions by repaying a $1.4 billion oil debt to Iran with a grain barter deal via US agribusiness giant Cargill, industry sources said.
Shell wants to repay a debt that is growing larger because of unpaid interest, having failed to settle its accounts with the National Iranian Oil Company (NIOC) ahead of a European Union embargo on oil imports that started on July 1.
It is hoping to get clearance from US, UK and Dutch authorities - who will be under pressure to agree on humanitarian grounds - for an "offset agreement" that would permit it to fund Cargill to deliver enough grain to Tehran to clear the debt.
"Shell wants to repay what it owes NIOC (National Iranian Oil Corp). They want to maintain amicable relations for the day when sanctions are lifted," said an industry source.
"An offset transaction is the only way forward," said another. "They are looking at several options. The main one is Cargill."
Shell and Cargill declined to comment.