Iran-Poland oil trade mutually significant

Business Materials 17 November 2017 15:50 (UTC +04:00)

Tehran, Iran, November 17

By Mehdi Sepahvand - Trend:

A recent agreement between Iran and Poland on oil export to the European country is significant to both countries, as well as to Europe in general, oil expert Narsi Ghorban believes.

Iranian crude oil will soon be making its way to Poland as reduced flows of sour crudes into Europe are prompting some refiners to look outside the region, shipping and trading sources said Tuesday.

PKN Orlen has bought a cargo of Iranian crude for November 24-25 loading dates, sources said. The Suezmax Delta Poseidon has been placed on subjects on a Kharg Island to Gdansk voyage at Worldscale 49, according to shipping fixture reports.

Ghorban, an oil market expert told Trend that such deals with European companies are highly significant for Iran since it is an importer of European goods and services.

"If Iran does not sell them oil or other energy carriers, then its trade balance with them will become negative," he said.

Under a series of US dollar sanctions, Iran will need monetary resources in other denominations to pay for its imported goods, the euro being the most potent candidate, he said.

Ghorban added that oil imports from Iran will also be significant for Poland or any other European country for they will be able to diversify their energy intakes.

Poland is heavily reliant on Russian Urals crude but the country's two refiners are slowly beginning to diversify their crude supplies.

Russian exports from the Primorsk oil terminal, where the bulk of the Urals program usually loads, have been down sharply this month due to scheduled maintenance.

Sources said this along with reduced flows of Kurdish crude into Europe due to tensions between the Kurdistan Regional Government and Iraq, are increasing spot demand for sour crudes from the Middle East into Europe.

The last time Poland purchased Iranian crude was earlier this year, when the Vilamoura tanker discharged Iranian oil in mid-January.

In July 2016, Grupa Lotos bought spot cargoes of Iranian light crude from Iran's National Iranian Oil Co. (NIOC).

PKN also occasionally buys spot cargoes from Iraq, Azerbaijan, Kazakhstan, Nigeria and Norway.