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

Video In Ukraine's Nikishino, No House Untouched by Fighting

Ninety percent of homes in one small village were damaged or destroyed as government forces failed to stop a rebel advance More

Pakistan’s 'Last Self-Declared Jew' Attacked, Detained

Argument about the rights of non-Muslims in Pakistan allegedly results in mob beating well-known Jewish Pakistani More

Turkey Cracks Down on Political Dissent, Again

People daring to engage in political dissent ahead of upcoming general elections could find themselves in jail 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.
In Their Own Words: Citizens of Kobanii
X
Mahmoud Bali
March 06, 2015 8:43 PM
Civilians are slowly returning to Kobani, after Kurdish fighters backed by coalition airstrikes fought off a four-month siege of the northern Syrian town by Islamic State militants. VOA Kurdish Service reporter Mahmoud Bali talked to some of those who have returned. We hear about the devastation of Kobani through their own words.
Video

Video In Their Own Words: Citizens of Kobani

Civilians are slowly returning to Kobani, after Kurdish fighters backed by coalition airstrikes fought off a four-month siege of the northern Syrian town by Islamic State militants. VOA Kurdish Service reporter Mahmoud Bali talked to some of those who have returned. We hear about the devastation of Kobani through their own words.
Video

Video In Ukraine's Nikishino, No House Untouched by Fighting

In the village of Nikishino, in eastern Ukraine, recent fighting has brought utter devastation. Ninety percent of the houses are damaged or destroyed after government forces tried and failed to stop rebels advancing on the strategically important town of Debaltseve nearby. Patrick Wells reports for VOA from Nikishino.
Video

Video Crime Scenes Re-Created in 3-D Visualization

Police and prosecutors sometimes resort to re-creations of crime scenes in order to better understand the interaction of all participants in complicated cases. A Swiss institute says advanced virtual reality technology can be used for quality re-creations of events at the moment of the crime. VOA’s George Putic reports.
Video

Video Sierra Leone Ebola Orphans Face Another Crisis

There's growing concern about the future of an orphanage run by a British charity in Sierra Leone, after a staff member and his wife died this week from Ebola. The Saint George Foundation Orphanage in Freetown is now in quarantine, with more than 20 children and seven staff in lock-down. The BBC has agreed to share Ebola-related material with Voice of America because of the difficulties faced by media organizations reporting the crisis. Clive Myrie reports from Sierra Leone.
Video

Video Growing Concerns Over Whether Myanmar’s Next Elections Will Be Fair

Myanmar has scheduled national elections for November that are also expected to include a landmark referendum on the country's constitution. But there are growing concerns over whether the government is taking the necessary steps to prepare for a free and fair vote. VOA Correspondent Steve Herman was recently in Myanmar and files this report from our Southeast Asia bureau in Bangkok.
Video

Video Nigeria’s Ogonis Divided Over Resuming Oil Production

More than two decades ago, Nigeria’s Ogoni people forced Shell oil company to cease drilling on their land, saying it was polluting the environment. Now, some Ogonis say it’s time for the oil to flow once again. Chris Stein reports from Kegbara Dere, Nigeria.
Video

Video Fuel Shortages in Nigeria Threaten Election Campaigns

Nigeria is suffering a gas shortage as the falling oil price has affected the country’s ability to import and distribute refined fuels. Coming just weeks before scheduled March 28 elections, the shortage could have a big impact on the campaign, as Henry Ridgwell reports for VOA.
Video

Video Report: Human Rights in Annexed Crimea Deteriorating

A new report by Freedom House and the Atlantic Council of the United States says the human rights situation in Crimea has deteriorated since the peninsula was annexed by Russia in March of last year. The report says the new authorities in Crimea are discriminating against minorities, suppressing freedom of expression, and forcing residents to assume Russian citizenship or leave. Zlatica Hoke has more.
Video

Video 50 Years Later African-Americans See New Voting Rights Battles Ahead

Thousands of people will gather to mark the 50th anniversary of a historic civil rights march on March 7th in Selma, Alabama. In 1965, dozens of people were seriously injured during the event known as “Bloody Sunday,” after police attacked African-American demonstrators demanding voting rights. VOA’s Chris Simkins introduces us to some civil rights pioneers who are still fighting for voting rights in Alabama more than 50 years later.
Video

Video Craft Brewers Taking Hold in US Beer Market

Since the 1950’s, the U.S. beer industry has been dominated by a handful of huge breweries. But in recent years, the rapid rise of small craft breweries has changed the American market and, arguably, the way people drink beer. VOA’s Jeff Custer reports.
Video

Video Video Claims to Show Shia Forces in Iraq Executing Sunni Boy

A graphic mobile phone video is spreading on the Internet, claiming to show Iraqi forces or Shia militia executing a handcuffed Sunni boy. Experts have yet to verify the video, but already Islamic State followers are publicizing it across social media, playing on deep-rooted sectarian fears. VOA’s Jeff Seldin reports.
Video

Video Ukrainian Authorities Struggle to Secure a Divided Mariupol

Since last month's cease-fire went into effect, shelling around the port city of Mariupol has decreased, but it is thought pro-Russian separatists remain poised to attack. For the city’s authorities, a major challenge is gaining the trust of residents, while at the same time rooting out informants who are passing sensitive information to the rebels. Patrick Wells reports for VOA.

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More