Iranian oil exports have dropped this month as waivers are soon set to expire, Refinitiv Eikon and tanker tracking data showed, according to Reuters. The United States is set to decide on new waivers—if there will be any—on May 2.
Iranian oil exports were on track in March to fall from January and February levels as countries that were granted that waiver the first time were unsure they would get a second one. But a rash of last-minute buying set Iran’s March exports near the previous months’ levels as waiver-holders sought to get shipments in under the wire.
January and February exports from Iran were higher than many thought they would be, between 1.1 and 1.3 million bpd. Estimates for March exports, according to Reuters, is 1.1 million bpd, but April’s exports so far are below 1 million bpd—precisely where the Untied States wanted Iran’s exports to be by May.
Earlier in April, US special envoy for Iran, Brian Hook, told Reuters that three of Iran’s biggest oil importers had stopped buying crude oil in April ahead of the waiver expiration. While Hook didn’t say which of the waiver holders had stopped buying oil from Iran completely, those three are likely somewhat responsible for the figures being reported today.
Several countries including South Korea and Japan had stopped buying Iranian oil altogether before the sanctions went into effect last November as US allies look to adhere to the sanctions. This time around, Japan is still proceeding cautiously, saying that Japanese refiners were unlikely to continue buying crude from April onwards—that is, unless the US grated it a waiver extension.
The United States is likely to extend some of the waivers in order to avoid price shock in the oil markets, although the volume allowed under new waivers will likely be less as the United States looks to get closer to zero Iranian oil exports.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group.