News / Middle East

Iran Crude Oil Exports Rise to Highest Since EU Sanctions

Petrochemical plant at an Iranian port. (2011 photo)  New sanctions target Iran's oil-dependent economyPetrochemical plant at an Iranian port. (2011 photo) New sanctions target Iran's oil-dependent economy
x
Petrochemical plant at an Iranian port. (2011 photo)  New sanctions target Iran's oil-dependent economy
Petrochemical plant at an Iranian port. (2011 photo) New sanctions target Iran's oil-dependent economy
Reuters
Iran's crude oil exports in December leapt to their highest level since European Union sanctions took effect last July, analysts and shipping sources said, as strong Chinese demand and tanker fleet expansion helped the OPEC member dodge sanctions.
       
Exports rose to around 1.4 million barrels per day (bpd) in December, according to two industry sources and shipping and customs data compiled by Reuters on a country-by-country basis and corroborated by other sources and consultants.
       
The sources said they expected exports to dip in January from the December peak ahead of new U.S. sanctions.
       
Western sanctions aimed at curbing Iran's disputed nuclear programme halved Iran's oil exports in 2012 from 2.2 million bpd in late 2011, leading to billions of dollars in lost revenue and a plunge in the Iranian currency.
       
But continuous robust demand from top buyer China and others such as India and Japan, as well as the purchase of new tankers, allowed the Islamic Republic to unexpectedly boost exports late last year.
       
The United States and the EU are hoping the economic pressure will force Iran to address international concerns about its nuclear programme, which Tehran insists is for peaceful purposes but the West suspects is for making weapons.
       
Salar Moradi, oil market analyst at oil and gas consultancy FGE, estimated that Iran shipped more than 1.4 million bpd of crude oil in December and forecast that exports would remain between 1.1 million and 1.3 million bpd in the first quarter of 2013.
       
This represents an increase from a low point of less than 900,000 bpd in September and suggests monthly revenues worth approximately $4.7 billion based on December Brent prices.
       
"They (Iran) bought a number of tankers from China and can now do more deliveries ... It's taken some pressure off Iran and facilitated tanker traffic and we are seeing higher exports to China,'' he told Reuters this week.
       
The second industry source said the rise in exports to near 1.4 million bpd was a result of traditional buyers finding new ways to secure shipping insurance.
       
But, like FGE, he estimated that they would fall slightly to around 1.3 million bpd in January.
       
Chinese Thirst

Chinese data showed the country bought 593,400 bpd of Iranian crude in December, the second-highest level of daily imports in 2012, a rise that Chinese officials also attributed to an easing of shipping delays.
       
Previously, Iran's tanker fleet had struggled to meet delivery schedules to China because EU measures in July barred Europe-based insurers from covering tankers that carry Iranian oil.
       
"China is saying let's up the numbers because no one is doing anything about it, and it looks like Obama has made a political decision not to go to war with Iran,'' said a senior source with a large independent trading house, referring to U.S. President Barack Obama.
       
Elena McGovern, oil and gas analyst at Business Monitor International, said: ``The implications of preventing Chinese imports from Iran would be too damaging to the (U.S.-China) bilateral relationship. I would be very surprised if Obama were to take China to task on Iranian imports.''
       
India's imports of Iranian crude were up 29 percent in December from November at around 275,000 bpd, according to tanker arrival data.

Tracking Iranian shipments has become increasingly difficult as companies have sought to conceal tanker movements from Western governments by turning off satellite signals.
       
Estimates of the Islamic Republic's monthly crude exports can vary considerably and are frequently revised.

New Sanctions Looming

A fresh round of U.S. sanctions coming into force next month
 could cap Iran's exports in the coming months as some buyers balk at the prospect of falling foul of the measures.
       
From Feb. 6, U.S. law will prevent Iran from repatriating earnings it gets from its shrinking oil export trade, a powerful sanction that the U.S. officials say will ``lock up'' a substantial amount of Tehran's funds.

       
"We continue to engage in close consultations with our international partners on U.S. sanctions with the objective of maintaining pressure on Iran to comply with its international obligations,'' said U.S. State Department spokesman John Finn.
       
"Month-to-month variability in crude oil purchases is not unusual,'' he added.
       
The International Energy Agency in December forecast a drop in Iranian exports to around 1 million barrels per day in late 2012 and early 2013.
       
But no matter how many rounds of sanctions are in effect, they are never watertight. Iran found creative ways to market its products and managed to sell more than 1.3 million tonnes of its fuel oil last summer, generating revenues equal to up to a third of its crude exports.
       
However, the latest data showed fuel oil exports have also taken a dip from the average 648,000 tonnes from July to October.

Exports fell to approximately 230,000 to 330,000 tonnes in December, Salar Moradi said, although he attributed this partly to higher domestic consumption in winter as utilities switch to fuel oil to replace gas used to meet heating requirements in the country.
       
In a more conservative estimate, data from a firm tracking Iranian fuel oil shipments showed that December exports were around 150,000 tonnes.

Condensate exports also fell by around 300,000 tonnes from November to 600,000 to 700,000 tonnes in December, data from the same firm showed. A Dubai-based analyst said condensate exports might come under further pressure as Iran's biggest customer in the Middle East has decided to reduce its purchases.

Dubai government-owned Emirates National Oil Co (ENOC) has started importing condensate from Qatar to replace sanctioned Iranian oil and is close to finalising deals with other producers, the company said on Sunday.

       
Still, some analysts think Iran will continue to find ways to safeguard against significant drops in its oil revenues.
       
"What we have seen is that when Iran is pushed to a do-or-die situation, they have looked for creative solutions to get around sanctions,'' said McGovern.
       
"The system will always find a way to cope.''

You May Like

Photogallery South Africa Bans Travelers From Ebola-stricken Countries

South Africans returning from affected West African countries will be thoroughly screened, required to fill out medical questionnaire, health minister says More

Multimedia UN Launches ‘Biggest Aid Operation in 30 Years’ in Iraq

Move aims to help thousands of Iraqi religious minorities who fled their homes as Kurdish, Iraqi government forces battle Sunni insurgents More

Video African Media Tries to Educate Public About Ebola

IT specialists, together with radio and TV reporters, are battling misinformation and prejudice about disease More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Gaza Conflict, Hamas Popularity Challenge Abbasi
X
Scott Stearns
August 21, 2014 9:20 PM
The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Gaza Conflict, Hamas Popularity Challenge Abbas

The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Nigeria's 'Nollywood' Movie Industry Rolls in High Gear

Twenty years after its birth in a video shop in Lagos, Nigeria's "Nollywood" is one of the most prolific film industries on earth. Despite low budgets and whirlwind production schedules, Nigerian films are wildly popular in Africa and industry professionals say they hope, in the future, their films will be as great in quality as they are in quantity. Heather Murdock has more for VOA from Lagos.
Video

Video UN Launches 'Biggest Aid Operation in 30 Years' in Iraq

The United Nations has launched what it describes as one of the biggest aid operations in 30 years in northern Iraq, as hundreds of thousands of refugees flee the extremist Sunni militant group calling itself the Islamic State. As Kurdish and Iraqi forces battle the Sunni insurgents, the fighting has forced more people to flee their homes. Kurdish authorities say the international community must act now to avert a humanitarian catastrophe. Henry Ridgwell reports for VOA from London.
Video

Video Cambodian American Hip Hop Artist Sings of Personal Struggles

A growing underground movement of Cambodian American hip hop artists is rapping about the struggles of living in urban America. Most, if not all of them, are refugees or children of refugees who came to the United States from Cambodia to escape the Khmer Rouge genocide of the 1970s. Through their music, the artists hope to give voice to immigrants who have been struggling quietly for years. Elizabeth Lee reports from Long Beach, California.
Video

Video African Media Tries to Educate Public About Ebola

While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.
Video

Video Ferguson Calls for Justice as Anger, Violence Grips Community

Violence, anger and frustration continue to grip the small St. Louis suburb of Ferguson, Missouri. Protests broke out after a white police officer fatally shot an unarmed black teenager on August 9. The case has sparked outrage around the nation and prompted the White House to send U.S. Attorney Eric Holder to the small community of just over 20,000 people. VOA’s Mary Alice Salinas has more from Ferguson.
Video

Video Beheading Of US Journalist Breeds Outrage

U.S. and British authorities have launched an investigation into an Islamic State video showing the beheading of kidnapped American journalist James Foley by a militant with a British accent. The extremist group, which posted the video on the Internet Tuesday, said the murder was revenge for U.S. airstrikes on militant positions in Iraq - and has threatened to execute another American journalist it is holding. Henry Ridgwell has more from London.
Video

Video Family Robots - The Next Big Thing?

Robots that can help us with daily chores like cooking and cleaning are a long way off, but automatons that serve as family companions may be much closer. Researchers in the United States, France, Japan and other countries are racing to build robots that can entertain and perform some simpler tasks for us. VOA’s George Putic reports.
Video

Video In Ukraine, Fear and Distrust Remain Where Fighting has Stopped

As the Ukrainian military reclaims control of eastern cities from pro-Russian separatists, residents are getting a chance to rebuild their lives. VOA's Gabe Joselow reports from the town of Kramatorsk in Donetsk province, where a sense of fear is still in the air, and distrust of the government in Kyiv still runs deep.
Video

Video Five Patients Given Experimental Ebola Drug Said to Be Improving

The World Health Organization has approved the use of experimental treatments for Ebola patients in West Africa. The Ebola outbreak there is unprecedented, the disease deadly. The number of people who have died from Ebola has surpassed 1,200. VOA's Carol Pearson reports on the ethical considerations of allowing experimental drugs to be used.
Video

Video China Targets Overseas Assets of Corrupt Officials

As China presses forward with its anti-graft effort, authorities are targeting corrupt officials who have sent family members and assets overseas. The efforts have stirred up a debate at home on exactly how many officials take that route and how likely it is they will be caught. Rebecca Valli has this report.
Video

Video Leading The Fight Against Islamic State, Kurds Question Iraqi Future

Western countries including the United States have begun arming the Kurdish Peshmerga forces in northern Iraq to aid their battle against extremist Sunni militants from the Islamic State. But there are concerns that a heavily-armed Kurdistan Regional Government, or KRG, might seek to declare independence and cause the break-up of the Iraqi state. As Henry Ridgwell reports from London, the KRG says it will only seek greater autonomy from Baghdad.
Video

Video In Rural Kenya, Pressure Builds Against Female Circumcision

In some Kenyan communities, female genital mutilation remains a rite of passage. But activists are pushing back, with education for girls and with threats of punishment those who perform the circumcision. Mohammed Yusuf looks at the practice in the rural eastern community of Tharaka-Nithi.

AppleAndroid