Page 7 - AsianOil Week 21 2022

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Iran struggles to sell crude

now at anchor in Asia

PERFORMANCE AN estimated 40mn barrels of Iranian crude oil off Singapore a week ago. This figure is up 15mn
is currently stuck offshore in ports around Asia barrels on the previous month.
looking for a buyer. An Iranian Oil, Gas and Petrochemical
As prices of Russian crude have fallen in the Products Exporters Union spokesman, Hamid
weeks following Moscow’s invasion of Ukraine, Hosseini, said: “Russia can switch almost half of
more and more oil cargoes from Iran have found its exports to Southeast Asia, especially China
themselves without end destinations. ... and that is a huge potential threat for Iranian
The majority of these cargoes fell foul of Asian crude exports.”
markets seeking to save money on cheaper, bet- Kpler has stated that Iranian exports of crude
ter-quality Russian imports. In the three months averaged 930,000 bpd across the first quarter.
since the outbreak of war in Ukraine, sanctions The bulk of this went to China.
by the US and other Western countries had left April figures were down to 755,000 bpd,
Russia looking for buyers for its crude. although Iranian crude sales are notoriously
But with India, and increasingly China, seek- difficult to confirm, with many buyers seeking
ing to benefit from Russia’s current focus on to avoid scrutiny by US agencies charged with
Asia, one casualty has been Iran. maintaining sanctions against Iran.
In the months leading up to the February “China is now clearly buying more Rus-
24 invasion, Iran had been making headway in sian Urals cargoes,” said a Kpler senior ana-
increasing its crude sales to China. In March, lyst, Homayoun Falakshahi. “Exports of Urals Singapore alone
China bought between 700,000 and 900,000 to China have more than tripled. That comes
barrels per day (bpd), illustrating its growing despite a weakening in Chinese imports.” is estimated to
importance as a buyer for Iranian oil. Yet whilst on the surface indications point to
But now these efforts by Iran to step up crude Russia and Iran competing for Asian buyers, it have around 20
exports to China have stalled, with sales in is thought that the countries are actually work-
April thought to be 200,000-250,000 bpd down ing together to help Russia keep its export infra- tankers loaded
on March. As soon as Western sanctions were structure alive. Iran has years of experience in with Iranian
imposed on Russia in late February and early maintaining exports whilst under international
March, with Russia trying to offload its crude by sanctions. crude currently
offering discounted prices, more expensive Ira- Russia’s Deputy Prime Minister Alexander
nian cargoes found themselves unwanted. Novak visited Tehran this week accompanied by anchored
This now leaves an estimated 40mn barrels of representatives of Russian transportation and
Iranian crude at sea with no buyers. Singapore logistics agencies. offshore.
alone is estimated to have around 20 tankers Meetings were scheduled with Iran’s Ministry
loaded with Iranian crude currently anchored of Roads and Urban Development in addition to
offshore, according to shipping data. Some of the influential Ports and Shipping Organisation,
these vessels are known to have been in place although official announcements or details on
since at least February, awaiting buyers willing agreements have yet to be released.
to skirt sanctions imposed by the US and other Sources speaking to some news agencies
countries on oil exports from Iran. Figures from have indicated, however, that Russia has been
data and analytics firm Kpler this week have looking for information on trading oil whilst
determined that 37mn barrels were anchored sanctioned.™

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