China is importing record volumes…
For the first time in…
Iran’s crude oil exports since the start of the month have averaged around 500,000 bpd, according to a Reuters report that cites estimates from tanker tracking companies. This is lower than March levels but much higher than a year ago, the report noted.
“Exports have continued at these elevated levels longer than we expected,” Reuters quoted the CEO of Petro-Logistics, Daniel Gerber, as saying. “And with constructive talks occurring in Vienna, we may never see a return to the 2020 lows.”
Calculating Iranian crude oil exports is difficult because of the cargo-masking and ship-to-ship transfers that Iran uses to circumvent U.S. sanctions that caused a slump in both its production and exports of oil. Yet, with the change of administration in Washington, hopes have returned that the United States could rejoin the Iran nuclear deal and lift sanctions.
Earlier this year, Tehran officials said that the country had started to ramp up oil production in anticipation of an agreement with the United States, which could see some 2 million bpd of Iranian oil—or even 2.5 million bpd—return to international markets. However, negotiations are still ongoing, and their success remains uncertain. Meanwhile, however, discount Iranian oil is getting on the nerves of some of its fellow OPEC members.
“These ‘sensitive’ barrels are hammering supplies from everywhere, as they are simply too cheap,” one Chinese trader told Reuters earlier this month.
“The recent jump in Iranian crude exports, notably to China, and crude going out of inventories are contributing to the weakness of the oil market, undermining OPEC+ efforts to limit supply and setting prices for a third weekly drop,” Rystad Energy said in late March.
China is by far the biggest buyer of Iranian crude: its March imports of the discount crude could have reached 1 million bpd, according to a Reuters report citing analysts and commodity traders.
Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.