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Brazil Refuels Iranian Ships After Standoff Over Sanction Fears

Sabrina Valle

(Bloomberg) -- Two Iranian ships stranded off Brazil’s coast are refueled and ready to sail home with a cargo of corn after a court order forced the state-controlled oil company to set aside concern about the risk of U.S. sanctions.

The ships were held up when Petroleo Brasileiro SA refused to provide fuel in early June, prompting Iranian threats to halt imports. The shipment is valued at 100 million reais ($26 million), according to an email from Kincaid Mendes Vianna, a law firm for Eleva, the Brazilian company that hired the vessels.

Brazil’s Supreme Court ruled on Thursday that Petroleo Brasileiro was obligated to supply Eleva with fuel. Petrobras can’t be sanctioned by the U.S. because it was invoiced by Eleva, a Brazilian company that isn’t on any U.S. sanctions list, according to the law firm.

Countries in the broader Middle East are major buyers of Brazilian corn, sugar and poultry. The economic ties set up a dilemma for President Jair Bolsonaro, who has shifted Brazil’s traditionally neutral foreign policy closer to the U.S. and Israel.

To contact the reporter on this story: Sabrina Valle in Rio de Janeiro at svalle@bloomberg.net

To contact the editors responsible for this story: Simon Casey at scasey4@bloomberg.net, Tony Czuczka, Steve Geimann

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