Iran Boosting Oil Exports in Violation of Agreement

Defying the demands of the international community, the Iranian government insisted it will continue to boost oil exports according to the Wall Street Journal. As part of the interim international accord with P5+1 nations, Iran agreed last December to limit its oil exports to 1 million barrels per day for six months.

But in response to a WSJ question, Iranian Oil Minister Bijan Zanganeh said, “we are trying to increase exports. Our exports are above 1 million barrels a day.”

In fact, Iran’s oil exports have averaged 1.37 million barrels per day over the first three months of the year. China, India, and South Korea accounted for much of the increase, according to IEA data in April. In April the Obama administration sought to downplay news reports that Iran was exceeding its allotted 1 million bpd limit, stating that it believed Iran would meet the limit when averaged over six months. “We expect, we still expect, and anticipate that this will average over a six-month period ... to meeting the bar that was set,” State Department spokeswoman Jen Psaki said on April 11.

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Iran was once the third largest exporter of crude, but crushing sanctions implemented in early 2012 by the United States and the EU severely slashed exports. Before the sanctions, Iran was exporting over 2.5 million bpd.

Meanwhile, talks on Iran’s nuclear program are set to restart on May 13, the beginning of negotiations over a comprehensive agreement. Both sides have expressed an optimistic tone heading into the discussions – Iran’s Foreign Minister Javad Zarif was impressed with the “unexpectedly fast pace of progress in the negotiations so far,” according to European Voice.

The agreed upon deadline is July 20, and if no deal is made, the sanctions that were removed in last year’s interim deal automatically go back into place.

By James Burgess of Oilprice.com