Iran asserts that it ditched US dollar, strengthened trade with ally Russia

Iran's Economy Minister Ehsan Khandouzi on Tuesday, July 26, announced that Tehran has officially ditched the US dollar as it strengthened the trade ties with Russian Federation. The Islamic Republic has been working with Moscow to come onboard its interbank messaging system and bypass the SWIFT financial transactions network, Kazem Jalali, Ambassador of Iran to Russia, had informed at a presser. “We are making efforts in this direction,” Jalali told reporters, according to the RIA Novosti. 

On Tuesday, Iran announced that it has replaced US currency with the Russian ruble as it struck many Iran-Russia business deals. Iran has also executed trade contracts with other regional allies and partners including India in Rupees and Iranian Riyal, Turkey, China to bypass the US led sanctions that were imposed by the former Trump administration after it unilaterally pulled out from the 2015 Iran nuclear deal. In the face of US belligerence, Iran's Supreme Leader Ayatollah Ali Khamenei has also been vigorously promoted his "look to the East" foreing policy.

Russia, Iran ink estimated $40 billion deal

As the president of the Russian Federation Vladimir Putin visited Iran, the two countries sealed an estimated $40 billion deal with Russian energy companies Gazprom, and Iran's state-owned National Oil Company. Russia, like Iran also now faces a barrage of the US sanctions for its brutal invasion of Ukraine. Kremlin in a statement had earlier announced that the Iran plans to de-dollarise its economy as do away the repercussions of the United States-imposed sanctions.

Putin's spokesperson Dmitry Peskov announced that Tehran and Moscow will gradually move away from the use of the dollar in bilateral relations. Kremlin's press secretary, and spokesperson for the President of the Russian Federation Peskov also told reporters of the state-affiliated agencies that Iran "will move away from the practice of using dollar" and switch to SPFS, Moscow's domestic 'System for Transfer of Financial Messages' equivalent of the SWIFT financial transfer system designed by the Central Bank of Russia to make transactions in own currency. "Although it may be wrong to count them in US dollars, and over time, we will probably move away from this practice as we develop our cooperation in the banking and financial sector," he iterated in an interview with Rossiya 24 TV channel. 

IMAGE: AP