Assessment of petroleum contracts adjustment consists renegotiation clause by arbitrator

Abstract

In many Petroleum contracts, the parties put renegotiation clause in order to keep longtime balance, so that if the balance disrupted, the parties should be obliged to renegotiate in order to rehabilitate the contract balance. So if renegotiation process didn’t reach result, what will happen to the contract? Also in which circumstances the parties have right to recourse arbitration? Do arbitrators have the right to adjust the contract? In one side, keeping the balance was the first base of the agreement, and by disrupting the balance the continuation of contract would become unfair and in contrast with common intention, and on the other side, termination of the contract without party consent is impossible. In the absent of arbitration clause, one parties can recourse to the arbitration tribunal, so that the tribunal can arbitrate the case if it is deduced from implicit agreement or enforceable law that it has jurisdiction. In case of putting adjustment right for arbitrator, he can adjust it. otherwise, it can be understood from the first intention of the parties, economical logic, principles of international trade law and the principle of similarity of arbitrator and judge authorities that the arbitrator has right to use adjustment.

Keywords

• renegotiation
• adjustment
• arbitration
• petroleum contracts
• international contracts