Iran Air Signs And Agreement With Boeing That Has Several Strings Attached

Iran Air announced that the carrier is looking to upgrade its fleet with a new generation of Boeing 737, in addition to the 300ER and 900 versions of the Boeing 777.

Iranian airlines have some 60 Boeing airplanes in service, but most were purchased before the 1979 Islamic Revolution that ousted Shah Mohammad Reza Pahlavi and brought Islamists to power.

Boeing said Iran Air signed a deal expressing its "intent" to purchase aircraft, The Associated Press reported.

Iran's commercial airlines suffered badly under Western sanctions imposed over its nuclear program, which kept them from obtaining spare parts for their planes. Iran had been an worldwide pariah prior to the nuclear deal reached in 2015; and the U.S.-Iran relationship remains one of mutual distrust, with the U.S. still maintaining extensive sanctions on Iran. Iran has kept flying those same planes for decades and its fleet of aging, worn-out commercial aircraft is in desperate need of replacement.

"While some politicians may take issue with this sale, it seems the administration is supportive of the transaction and that this should be sufficient to permit it to go forward despite some complaints", Jefferies said. The deal, which had a list price value of about $27 billion, hasn't been completed because of worries in the financial community about doing deals in Iran.

Boeing says the Obama administration approved its initial deal with Iran after determining that Tehran is meeting its obligations under the nuclear agreement.

Abedzadeh added that Boeing has submitted an official request to the US Treasury on final authorization for the aircraft sale.

Approval from USA officials is required since more than 10% of Airbus materials are of American origin.

"The JCPOA provides an opening for civil aviation companies, including American companies, to pursue legitimate commerce with Iran, and we note reports of progress in the aviation sector, which is good for both the economy and for public safety".

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