Azerbaijan, Baku, June 21 /Trend S.Isayev/
Oil exports from Iran are going to drop further by 200-300 thousand bpd close to the end of 2012, professor at the University of Glasgow and expert on nuclear issues Reza Taghizadeh told Trend.
Uncorfirmed reports say crude exports from Iran so far this month have dropped to between 1.2 million barrels per day (bpd) and 1.3 million bpd, according to a firm that tracks oil shipments and sources at oil companies.
If confirmed, this latest decline indicates Iran may have lost as much as 1 million bpd of oil exports - worth around $90 million a day - due to the threat of an EU ban starting July 1 which also bars EU insurance firms from covering Iran's exports.
A year ago Iran was selling around two-thirds of its crude exports, or roughly 1.45 million bpd, to its four big Asian oil buyers - China, Japan, South Korea and India.
"The imports from Iran have been reducing even before the July 1 embargo," Taghizadeh said. "After that date, it will be more of the same".
Taghizadeh said Iran will continue to export its oil to Asia, however the amount would be significantly reduced - close to 20 percent less.
"Iran desperately needs the 1 million bpd exports," Taghizadeh said. "The U.S. has decided to go in-between, and not to impose further sanctions, so Iran would not be completely stripped off its oil income".
Speaking about the oil countries that could substitute Iran, Taghizadeh noted that there is preference in place.
"Most of Iran's oil clients tend to rely on Saudi Arabia as an oil supplier, since the quality of imported oil does not differ from Iran's that much," Taghizadeh said. "Importers have to adjust their refineries for the imported oil, and for that reason, they chose Saudi Arabia as their main oil exporter."
Speaking about Libya and Iraq as other options, Taghizadeh said Libya is already getting close to its maximum potential, while Iraq, if stable, can become a reliable source of oil export.
"Thus far, Saudi Arabia, which has increased its output by 1.5 million bpd is the main oil supplier," he said.
Some of Iran's major customers in Asia, though, are figuring out ways to keep imports flowing, although at overall reduced rates, despite the EU ban on insuring tankers.
The EU in January embargoed purchases of Iranian crude but let those with existing contracts continue until July 1. The West suspects Iran is trying to develop atomic bombs, while Tehran says its nuclear work is solely for civilian purposes.
Last year, Iranian crude exports were running at about 2 million-2.2 million bpd with total production, including domestic consumption, at 3.5 million-3.6 million bpd.
There is no timely official data on Iranian crude export levels and there are often differences of opinion among those that monitor its supplies on the rate of shipments.
Iran in April conceded that its exports had fallen slightly to 2.1 million bpd from 2.2 million bpd at the end of last year.