The $8 billion Willow project…
Global oil production fell significantly…
Iran’s oil exports dropped by 7 percent to 2.32 million bpd in July—their lowest level in four months—as South Korea and Europe are slashing imports ahead of the return of the U.S. sanctions on Tehran, data from S&P Global Platts showed on Tuesday.
However, Iranian oil exports to its top two customers—China and India—continued to stay high last month. Exports to China rose to 799,452 bpd in July from 722,100 bpd in June, while Iranian oil sales to India increased by more than 40,000 bpd from June to 706,452 bpd in July, S&P Global Platts data shows.
Europe—which as a whole has been Iran’s third-biggest single customer—saw imports drop to 465,450 bpd last month from 485,768 bpd in June, with demand from France, Spain, and Turkey down and purchases from Italy and Greece steadily up. In Europe, spot demand for Iranian crude is sharply down, but refiners with term contracts are still honoring them, according to sources who spoke to Platts.
Analysts expect Iran’s oil exports to drop more noticeably beginning in September, and the rate of decline to accelerate as the United States looks to have Iran’s current customers reduce Iranian oil imports to ‘zero’.
In June, although China and India held their Iranian oil purchases high, the top Asian oil importers and Iranian oil customers—China, India, Japan, and South Korea—bought in June their lowest combined volume of Iranian oil in seven months, as South Korea slashed Iranian purchases. Starting in July, South Korea is halting Iranian oil imports for the first time since 2012 amid pressure from the United States to discontinue purchases from Iran.
Analysts expect the U.S. sanctions to take between 500,000 bpd and 1 million bpd of Iranian crude oil off the market when full sanctions return in early November, and some experts think that the figure will be closer to 1 million bpd.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com:
Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.