Accumulated crude volumes increase Iranian export

Accumulated crude volumes increase Iranian export

Azerbaijan, Baku, July 16 /Trend T.Konyayeva/

An increase in Iranian crude oil export to certain countries might be both a temporary measure required to reduce the volume of the Iranian tankers stockpiling crude which IRI failed to ship to India, Malaysia and Southern European countries because of international sanctions and a result of removing subsidies, experts believes.

"The increase in exports [to China, Pakistan and South Africa amongst others] is a temporary measure to reduce the volume of float (that is unsold stockpile of crude) in the Iranian-owned tankers which Iran has not been able to sell due to sanctions," EU consultant on economic issues Mehrdad Emadi wrote Trend in an email. "Sanctions whilst not affecting sale or export of crude directly, through payment limits and banking restrictions are making exports very difficult."

Iran has increased oil exports by 260,000 barrels of oil per day (bpd) in the past two weeks, with the country's production capacity currently hitting 4 million barrels per day, Mehr News Agency reported this week.

According to BP statistics, Iran's oil production volume in 2010 was 4.245 million bpd, 4.199 million bpd in 2009, and 4.327 million bpd in 2008.

Earlier, the Head of the Parliament's Energy Commission Hamidreza Katuzian said that Iran's oil production decreased by 72,000 bpd compared to 2008. Iran's crude oil consumption in 2010 was 1.799 million bpd, indicating one percent increase compared to 2009.

Mehr News Agency did not clarify how Iran was able to increase oil exports without increasing oil production or decreasing oil consumption in the local market.

According to Emadi, payment limits and banking restrictions have resulted in Iran seeing a rise in the volume of crude that now has to be kept in the tankers since all land-based reserve sites are filled with crude.

"To cope with falling demand for its oil arising from sanctions-related payment problems, tankers now are used more and more for keeping stockpiles and less for transport," he underscored. "To summarize the two week rise in export of crude is exactly that and is the result of cancelled shipments to India, Malaysia and Southern European markets which are beginning to feel the bite of sanctions. It is unsold oil exported to be sold at sub-market price."

Iran's refusal to abandon its nuclear activities has resulted in resolutions adopted by the UN Security Council in 2010, as well as additional unilateral sanctions approved by the U.S. Congress and the foreign ministers of all EU countries, which were primarily directed against the banking, financial and energy sectors of Iran.

Restrictions imposed by the EU include the ban on the sale of equipment, technologies and services to Iran's energy sector which is a major source of revenue for the Iranian regime; the same measure refers to the refining industry.

Emadi added that BP's statistics are somewhat overestimating the actual output of the oil industry.

"My own figures tally with those of Mr. Katuzian and show that by May 2011, oil production had fallen by 110,000 bpd compared with 2008," he said.

According to Emadi, cancellation and pull out of Total, Statoil, ENI, RD/Shell and Inpex following their cooperation with sanctions induced a fall of more than 250,000 bpd in production compared with March 2005.

Last September, expanded U.S. sanctions on Iran there have prompted four of Europe's five biggest oil companies - Total, Statoil, Eni and the RD/Shell - to stop investing in Iran.

In October, 2010, Inpexç Japan's top oil explorerç announces withdrawal from Iran's Azadegan oil field project to avoid U.S. sanctions. Inpex has invested $153 million in this giant project.

Emadi believes that the substitution of CNPC (China) and Sinopec (China) in Azadegan and Darkhovin fields have been much less effective to fill the gap left by the exit of Total, Eni and Statoil than hoped by the authorities.

"As a result even though the new discoveries of oil has increased proven oil in Iran by 25 percent in the last two years, poor maintenance and substandard servicing of infrastructure have caused as decline of 2-4 percent in output per well since 2003," he thinks.

Furthermore, Emadi said, increase in domestic production of petrochemical products which have been increased to reduce the effects of sanctions on the import of gasoline, diesel, gas-oil and other processed fuels has diverted about 140,000-150,000 bpd of crude away from exports. Also domestic crude consumption has risen by 1.4 percent since November 2009, he noted.

"Being optimistic and using the above figures, sub-standard maintenance (2 percent), increased domestic production of petrol and diesel (150,000bpd or 12 percent in volume available for exports) and increased domestic consumption of crude (1 percent), suggest a fall of about 15 percent in the volume available for exports," Emadi said.

The expert believes that the situation has been exacerbated by the most recent restrictions on investment in oil and gas industries.

"The basic arithmetic of these numbers contradicts the scenario of increased exports except in this case it seems that the increasing volume of float crude and the cost of tanker usage have forced the authorities to sell the float volume at below market prices which seems a rational short term solution," Emadi believes.

But the facts of the industry show that the potential for increasing exports is very limited, he said.

"Until new technology comes in and sanctions are lifted, at best we will see present level of exports" Emadi said. "I personally expect a small annual fall in the figures."

According to Hooman Peimani, Head of the Energy Security Division at the Energy Studies Institute of Singapore, the increase in Iranian oil export is possible because of lifting energy subsides.

"The price of gasoline, gas-oil and other oil products increased and therefore the domestic energy consumption has decreased, but we don't know the exact volume of Iran's surplus oil for export," he said.

The targeted subsidy plan launched in December 2010 aims to gradually remove all subsidies over a five-year period and instead give families cash handouts as compensation.

It eliminates subsidies on gasoline, natural gas, electricity and food and is considered to be one of the most important economic undertakings in Iran's modern history.

Uzbekistan to connect number of small industrial zones to utility networks
Uzbekistan to connect number of small industrial zones to utility networks
Consumers must protect IoT devices - Fortinet
Consumers must protect IoT devices - Fortinet
Azerbaijan's CBC radio starts broadcasting in Karabakh
Azerbaijan's CBC radio starts broadcasting in Karabakh
Loading Bars
Latest
Kyrgyzstan introduces state regulation of prices for vegetable oil and sugar
Immunization Technical Advisers of Georgia hope WHO to authorize Sinovac
Envoy: Iran supports Afghan peace process
TRACECA Permanent Representative talks cargo traffic growth on Azerbaijani section
Over 610 Palestinians injured in clashes with Israeli police in East Jerusalem - newspaper
Some 20 terrorists killed, 4 bases destroyed in Burkina Faso
WHO records over 677,000 new daily cases of COVID-19 worldwide
Italy reports just over 5,000 new COVID-19 cases, 198 deaths
7 rockets fired from Gaza at Jerusalem area: Israeli military
Saudi Arabia to require arriving visitors to quarantine for a week
Oil prices inch higher as traders eye U.S. pipeline shutdown
Palestinians report several killed in Israeli air raids on Gaza
Biden confident he will meet with Putin
Over 1.6mln receive COVID-19 vaccine in Kazakhstan
Azerbaijan's import of cars from Turkey drops
Iran makes advanced industrial flame arrester
Putin says 21.5 mln Russians vaccinated against COVID-19
U.S. Treasury launches access to $350 billion in state/local COVID-19 aid
President Ilham Aliyev receives delegation led by Russian foreign minister (PHOTO)
Global COVID-19 cases, deaths reach plateau - WHO
Electric, hybrid car sales in Turkey surge over 200% in 4 months
Georgian, North Macedonian Presidents sign visa-free agreement
Second component of Sputnik V vaccine delivered to Kyrgyzstan
Iran produces oil-based ozone generator
India COVID cases hold close to record highs as calls widen for national lockdown
USAID’s focus to remain on modernization of energy sector in Kazakhstan
China-made meteorological satellite for dawn-dusk orbit passes review
Saudi Arabia's GDP contracts 3.3% in Q1 on oil output, non-oil economy recovers
Azerbaijan purchasing new equipment to speed up mine clearance on liberated lands (VIDEO)
Iran's Energy Exchange announces products to be on sale on May 11
Weekly review of Azerbaijani precious metals market
Activities in Iran’s Khorramshahr port climb
Iran’s Bahar Azadi gold coin price continues to increase
New facility to be put into operation in Iran’s electricity sector
Iran boosts production, export of greens and vegetables
Azerbaijan shares data on number of vaccinated citizens for May 10
Iran's ICOFC to develop two gas fields
National leader Heydar Aliyev`s 98th anniversary marked at parliament (PHOTO)
Program of Russian FM's visit to Azerbaijan unveiled
Azerbaijan confirms 371 more COVID-19 cases, 892 recoveries
Public reps of Azerbaijan paying tribute to late National Leader Heydar Aliyev (PHOTO)
Mine-clearing operations begin in Azerbaijan's liberated villages
Iran talks IAEA monitoring cameras at nuclear sites
Presidents of Russia, Azerbaijan hold phone conversation
Int'l organizations notified about Armenia's crimes against Azerbaijani civilians - Azerbaijan's prosecutor general
Criminal cases against Armenian terrorists who fought in Karabakh nearing completion - Prosecutor General of Azerbaijan
Uzbekistan eyes ratifying two more conventions of International Labor Organization
Uzbek mining and metallurgical complex exceeds export plan by half
Cargo movements in Iran’s Imam Khomeini port up
Iran reveals details of saffron exports
Various results achieved in Vienna every day – Iran’s MFA
Oil gains after cyberattack forces shutdown of U.S. fuel pipelines
Heydar Aliyev saved independent Azerbaijan from disappearing from political map - Russian expert
Iran, Saudi Arabia conduct both bilateral, regional talks – Iran's MFA
Registration of presidential candidates starts in Iran
Volume of loaded, unloaded cargo in Iranian ports grows
President Ilham Aliyev ends visit to Nakhchivan Autonomous Republic (PHOTO)
Uzbekistan notes significant increase in bank cash turnover in 4M2021
Uzbekneftegaz reveals indicators of oil and gas production and processing in 4M2021
Uzbekistan and France sign cooperation program
Uzbekistan Helicopters LLC opens tender for refueling vehicle
Political will of Heydar Aliyev bearing fruit - colonel general
Carbon price to rise, as governments pursue deeper decarbonisation strategies
Iran expects to increase vaccination
President Ilham Aliyev interviewed by Azerbaijan Television (PHOTO)
Death toll from COVID-19 exceeds 75,000 people
Number of confirmed coronavirus cases in Russia rises by 8,465 per day
President Ilham Aliyev views Ordubad railway station (PHOTO)
President Aliyev attends launch of project for reconstruction of drinking water supply, sewerage systems in Ordubad (PHOTO)
President Ilham Aliyev views construction of Ordubad Hydroelectric Power Plant (PHOTO)
ERIELL to work on wells at field in Uzbekistan’s Karakalpakstan
First Vice President of Azerbaijan shares publication on occasion of 98th anniversary of birth of National Leader Heydar Aliyev
President Ilham Aliyev attends inauguration of Julfa-Ordubad highway (PHOTO)
Uzbekistan’s 1Q2021 tomatoes export revealed
Turkey sees increase in cement exports to Azerbaijan
Kazakhstan-Israel trade plummets y-o-y
Uzbekistan to connect number of small industrial zones to utility networks
Weekly review of Azerbaijani currency market
ACG oil transshipment from Ceyhan terminal exceeds 70 mb YTD
EBRD, EIB, Proparco to fund construction of solar power plant in Uzbekistan’s Samarkand
President Ilham Aliyev attends opening of Artificial Insemination Center in Nakhchivan (PHOTO)
Azerbaijan creating 'green' energy zone in liberated Karabakh
President Ilham Aliyev attends opening of Nakhchivan Garrison Central Hospital (PHOTO)
President Ilham Aliyev attended inauguration of Nakhchivan branch of “Azerkhalcha” OJSC (PHOTO)
Weekly review of Azerbaijani oil market
Bank of Israel cuts government bond purchases
President Ilham Aliyev viewed construction of “ASAN xidmət” Center in Nakhchivan (PHOTO)
Turkey's 4M2021 steel exports to Turkmenistan shrink
Armenian Parliament to reconsider issue of electing new prime minister
Iran increases sturgeon farming
World's largest cargo plane with UK Covid aid takes off for India
President Ilham Aliyev visits statue of national leader Heydar Aliyev in Nakhchivan (PHOTO)
India to recruit 400 retired medical officers of AMC, SSC; Defence Ministry issues orders
Iran eyes to expand ties Turkmenistan
Azerbaijani president visits graves of martyrs of Patriotic War at Nakhchivan city cemetery (PHOTO)
Indian-Led Ground-Breaking Cancer Test Hopes To Launch This Year
President Aliyev attends opening of military aerodrome of Special Combined Arms Army (PHOTO)
Iran to renovate public transport fleet
Iranian water and electricity companies to enter EAEU market
Artists of Int'l Arts Festival create 'Kharybulbul' model in Azerbaijan's liberated lands (PHOTO)
All news