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Iran has stopped oil exports to British and French companies, months before the European Union’s embargo on Iran’s oil takes effect, Iran’s oil ministry said Sunday, according to Xinhua News.

Oil ministry spokesman Alireza Nikzad-Rahbar said as the oil minister had earlier announced about the probability of halting oil exports to some European Union (EU) countries, “the Oil Ministry has stopped oil sales to British and French companies.”

The move is a retaliatory measure against The European Union who in January decided to stop importing crude from Iran from July 1 over its disputed nuclear program, which the West says is aimed at building bombs. Iran has denied this.

Oil prices last week jumped to its highest level in over a month on the news.

Stopping Iranian shipments means European refineries will have to find new sources of oil sooner than they expected, according to an Associated Press report.

The European Union, which buys about 18 percent of Iran’s total crude exports, had planned to embargo Iranian oil this summer to pressure the country to abandon its nuclear program.

The Islamic Republic has no problem in selling its crude oil to its customers, Nikzad-Rahbar was quoted in the Xinhua report saying. “We have our own oil customers and the replacements for these (British and French) companies have already been considered and we will sell the crude oil to new customers instead of the British and French companies.”

The spokesman’s remarks, which did not specify the time of the sales’ cut to the British and French companies, were posted on the website of Energy and Oil Information Network affiliated to the Iranian Oil Ministry.

Analysts quoted by the Associated Press report said that Iran gets about half of its revenue from oil exports.

Iran will now likely sell oil to China and India to make up for the loss of European sales. That oil probably will be sold at a discount, however, since much of the international community is turning its back on Iranian oil.

If Iran does stop selling oil to Europe, refineries in the eurozone will look to Libya and Saudi Arabia to replace Iranian oil, the Associate Press report said.

If those countries can’t deliver, oil prices could increase further in coming months, the report added. Source: Xinhua News and Yahoo Finance News

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