South Korea Serious About Ditching Iranian Oil

South Korea did not import any Iranian crude oil in October, the second month in a row one of the world’s top oil importers has abstained from buying Iranian crude ahead of the U.S. sanctions against Tehran, which entered into effect on November 5.

Reuters reported the data, citing information from the South Korean customs authorities, adding the country had stopped buying Iranian crude in September for the first time in six years as it was not certain it would score a waiver with the U.S. Department of Treasury. It did, however, score the waiver, along with seven other large Iranian oil importers. The waivers,. However, are temporary, for six months, after which Washington has suggested it would expect a reduction to zero again.

Reuters also reported that between January and the end of August South Korea imported 7.15 million tons of Iranian crude, half the amount it had imported a year earlier as it prepared for the sanctions. Now, according to unnamed sources, South Korea could buy up to 200,000 bpd of Iranian condensate. Meanwhile, in October, the country compensated the lack of Iranian barrels with more imports from Saudi Arabia, its top supplier. These rose twofold to 4.17 million bpd.

Earlier this month, S&P Global Platts reported South Korea would resume Iranian crude oil purchases after the sanctions went into effect, according to information from unnamed sources. While continuing to look for alternative suppliers of the commodity, the sources said, the world’s fifth-largest oil importer would buy some 4 million barrels of Iranian crude monthly.

In this and other transactions with Iran, South Korea will pay in its national currency instead of U.S. dollars, PressTV reported recently, citing South Korean media. Iran has been actively promoting trade in national currencies with its international allies to reduce its exposure to sanction-tied dollars.

By Irina Slav for Oilprice.com

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