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South Korea doubled its imports of Iranian crude in January this year from the same time last year, when Iran returned on the international oil market and started exporting growing amounts of oil in a bid to regain market share lost to the Western sanctions.
According to preliminary South Korean customs data reported by Reuters, the Asian country, which is also the world’s fifth-largest crude importer, last month imported 1.79 million tons of crude from Iran, which is equal to 424,143 bpd, compared to 859,223 tons in January 2016, when sanctions on Iran were lifted.
This development takes market share away from Iran’s key rival, Saudi Arabia.
South Korea’s imports of crude oil from Iran’s regional rival Saudi Arabia dropped by 17.3 percent in January compared to December 2016, to 785,084 bpd, as the Saudis are complying with the OPEC supply-deal cut.
South Korea’s total crude oil imports from all oil-exporting nations increased by 14 percent annually to 2.93 million bpd in January, the preliminary customs data showed. But the total January imports were 6.3 percent lower than the imports for December 2016.
State-held Korea National Oil Corp (KNOC) is releasing final figures on the country’s crude oil imports later in February.
In the third quarter of 2016, South Korea imported 270.4 million barrels of crude, up 3.9 percent on the year, as it was taking advantage of lower prices from Middle Eastern exporters vying for market share in Asia.
Among producers, Iran was the biggest beneficiary of this increased Korean consumption, with imports from it skyrocketing by 147.7 percent on Q3 2015.
More recently, Iran has been raising its exports and taking advantage of the cuts other OPEC members are making as part of the deal, while Tehran was given leeway to slightly increase output. Iran’s crude oil and condensate exports increased 3 percent month-on-month in January, while the exports of all other Middle Eastern producers dropped, according to analysis by Platts published last week.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.