Israel rejects Swiss court ruling to pay $1bn oil debt to Iran

Israel announced on Wednesday that it rejects a Swiss court ruling to pay $1.1 billion to Iran over the sale and shipment of oil prior to the Iranian revolution in 1979.

“Without referring to the matter at hand,” said the Israeli ministry of finance, “we’ll note that according to the Trading with the Enemy Act it is forbidden to transfer money to the enemy, including the Iranian national oil company.”

Israeli media quoted the official Iranian news agency, IRNA, which cited an “informed source” within Tehran’s Presidential Centre for Legal Affairs giving details of the Swiss Federal Supreme Court ruling with regard to a “joint oil venture”. Iran has been embroiled in a legal battle against Israel in courts in Switzerland and France, demanding that it should pay the debt.

The argument dates back to a 1968 agreement between Israel and the Shah’s government. The Iranian Oil Company delivered 14.75m cubic metres of crude oil through the Eilat-Ashkelon pipeline to Israel’s Trans-Asiatic Oil Company valued at $450m.