Asian buyers take 29.4pc more Iran oil in July on-year

August 29, 2014 - 10:11:20 am

TOKYO: Iran's major Asian customers shipped in 29.4 percent more crude in July from a year earlier, with China, Tehran's biggest client, still accounting for most of the increase seen since Western sanctions were eased at the beginning of the year.

Western powers have been pushing for Iran to scale back its nuclear programme for a decade, and an initial deal that eased crippling sanctions in place since early 2012 to work out a final agreement has been extended another four months.

Under the interim agreement that now runs to Nov. 24, Iran's crude exports were to be held at just above 1 million barrels per day (bpd), about where they are now after surging as much as 40 percent above this level in the early part of the year.

Despite the lack of a crackdown on the higher volumes, there are no indications Washington will loosen the cap before a final deal is reached with Tehran. Industry sources have said Iran's exports would rise quickly after a final deal had been struck.

"Export volume would likely rise, and supplies could be directed to Europe and the United States," said Hiroki Kakuno, analyst at Japanese refiner Idemitsu Kosan Co.

"That could push official selling prices of Iranian crude to Asia higher. If that happened, demand for other crudes may rise, and Iran's supplies to Asia could fall."

Iran's biggest buyers - China, India, Japan and South Korea together took in a seven-month low of 1.029 million bpd of the Islamic republic's crude last month, down 0.3 percent from a six-month low hit in the previous month, government and tanker-tracking data showed.

For the first seven months of 2014, the four buyers' imports averaged 1.18 million bpd, up 25.9 percent from a year ago.


China's imports from Tehran for the January-July period were at 617,670 bpd, up nearly 200,000 bpd and making up the main portion of this year's stronger Asian imports.

For July, China's imports from Iran were up 40.6 percent at 558,865 bpd, marking its seventh straight month of year-on-year gains.

India's imports in July jumped nearly six-fold to 210,300 bpd, reflecting drastic cuts made a year ago due to a lack of insurance for processing Iranian oil.

South Korea's imports fell 31.6 percent from a year ago to 130,226 bpd last month, while shipments to Japan - the last of the four to report its oil intake - fell by 24.4 percent to 129,990 bpd last month, trade ministry data showed on Friday. (Reuters)