The 1968 deal involved the shipping and sale of Iranian oil via the Red Sea port at Eilat.

JNS.org – A court in Switzerland has reportedly ruled that Israel must pay Iran $1.1 billion for failing to meet compensation on an oil deal signed between the two countries before the 1979 Iranian revolution.

The 1968 deal, conducted at a time of friendly relations between the two countries and when Iran held shares in the Eilat-Ashkelon Pipeline Co., involved the shipping and sale of Iranian oil via the Red Sea port at Eilat.

Through this port, the Iranian Oil Company delivered 14.75 million cubic meters of crude oil to Israel’s Trans-Asiatic Oil Ltd. That amount of oil was worth $450 million, according to the Islamic Republic News Agency.

But after the Islamic Revolution in Iran in 1979, the Iranian government no longer recognized Israel and all the oil contracts with the Jewish state were frozen.

Iran proceeded to sue Israel in France and Switzerland, and the current oil deal ruling is not the first one in Iran’s favor. In 1989, another Swiss court ruled that Israel’s Trans-Asiatic Oil Ltd. should pay $500 million to Fimarco Anstalt, a sub-contractor of the Iranian Oil Company.