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The Iranian Oil Ministry has reported that it sold a million barrels of crude to Spain’s energy major Repsol, in the latest demonstration that the Middle Eastern country is fast catching up with its pre-sanction oil exports.
Ever since the Western sanctions imposed on Iran in connection with its nuclear program were lifted early this year, oil exports to Europe have shot up from 100,000 barrels per day (bpd) to 600,000 bpd. These are expected to rise further to 700,000 bpd.
Repsol is not the only one buying crude straight from Tehran, either. Earlier this month Oilprice reported that two Italian companies, Saras and Iplom, have closed one-year deals with Iran’s National Oil Company to buy crude oil to refine at home.
Iran has long-term relations with the Italian energy industry, most notably oil and gas giant Eni. Now Eni is returning to the country to work on the development of the Darkhovin oil field.
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Repsol is also among the European companies eager to enter Iran’s oil and gas industry, and according to sources close to the company, this eagerness will pay off. Repsol, like its peers and larger rivals, has been hit hard by the oil price crisis from the last two years, and it has shrunk international operations to weather the effects of the crisis by slashing capex and selling assets.
Iran, with its new Petroleum Contract, seems like a lucrative opportunity for the embattled Spanish company amid hopes for a continuous oil demand and price improvement.
By Irina Slav for Oilprice.com
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Irina is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing on the oil and gas industry.