Page 4 - MEOG Week 35

MEOG Commentary MEOG
Mixed messages
on Iran as tanker
changes course
Statements by the US and Iran have seen tensions between the two continue to mount, while a much-watched Iranian oil tanker is still evading US capture in the Mediterranean
Iran
What:
Statements and rebuttals by the governments of Iran and the uS have continued to ow over the past week as tension over sanctions and oil exports remains high.
Why:
Iran has claimed that the US has shown willingness to be exible over Iranian oil exports, though the pair remain in a war of words over the Adrian Darya 1.
What next:
There have been signs of an easing of tensions, but while progress may be made, it will likely hang on the whims of the ultra-hawkish Trump administration.
IRAn has remained in the headlines this week as comments continue to put spin on the issue of sanctions and the Adrian Darya 1 oil tanker situation.
The final destination of the vessel and its 2.1mn barrel cargo is yet to be determined, though following the announcement that the oil had been purchased Adrian Darya 1 has sailed around Crete, apparently heading for Turkey, although at time of going to press it had come to a near stop due west of the Syria/Lebanon border. US Secretary of State Mike Pompeo on August 31 tweeted that his government had “reliable information that the tanker is underway and headed to Tartus, Syria”. He added: “I hope it changes course. It was a big mistake to trust Zarif,” referring to assurances given by Iranian Foreign Minister Javad Zarif when the ship was held in Gibraltar that it would not take the cargo to Syria.
e original suspected destination of the ship was Syria’s Baniyas re nery.
Various destinations have been suggested for its new destination, most notably Lebanon and o oading the cargo on to smaller vessels so it could traverse the Suez Canal and take the ship- ment to Qatar. For the time being, though, its status remains “For Order”.
In response to Pompeo, Zarif tweeted: “US
engages in piracy & threats to prevent Iran from selling oil to traditional customers. Stop nagging @SecPompeo: We will sell oil to any & all buyers.”
output uptick
Meanwhile, Iranian Oil Minister Bijan Zangeneh was quoted by the Mehr news agency as saying that the country would be able to ramp up output to pre-sanctions levels within just three days.
“Three days are needed to return produc- tion to the levels before the reduction,” he said. However, with Iranian oil sales still struggling, the statement appears to be of little consequence.
Indeed, an advisor to the Iranian Ministry of Petroleum (MoP), speaking on condition of anonymity, told Middle East Oil & Gas (MEOG): “ ey can raise the output very quickly but they cannot if it cannot be exported.”
However, the source added that the MoP had been mulling “a Russian proposal pertaining to Russia becoming the marketing hub for Iranian crudeinreturnforahandlingfeeof25%”.
This would cohere with Russia’s offer of Crimea’s Black Sea ports last week for Iran to ship its oil. Iran’s capability to ship oil to Russia would likely require cargoes to ow north across the Caspian Sea, though its sole Caspian export terminal at neka has a capacity of just 150,000 barrels per day (bpd). There have long been
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w w w . N E W S B A S E . c o m Week 35 03•September•2019