The National Iranian Oil Co has contacted five refiners in Asia for possible trade deals if the United States lifts the sanctions.
Iran is reaching out to former clients in Asia to gauge their interest in buying its oil as Tehran steps up diplomacy to get US sanctions lifted.
The National Iranian Oil Co. – the state-owned oil distributor – has contacted at least five refiners in the region to discuss the possibility of supply deals if sanctions are relaxed, according to people familiar with the matter. Discussions are preliminary, with no discussion of volumes or prices at this time, they said, asking not to be identified as the information is confidential.
A processor has been contacted twice this year after having had no interaction with the OPEC producer in 2020, according to one person. Iran’s oil ministry declined to comment on the matter.
Iran’s crude shipments declined to become a trickle after former US President Donald Trump tightened sanctions from mid-2018 and ended waivers for some countries in 2019. Yet a number Chinese refiners continued to take oil. Before the sanctions – put in place to pressure Tehran to renegotiate a nuclear deal – China and India were Iran’s biggest buyers in Asia, followed by South Korea and Japan.
The Islamic Republic’s exports had reached around 2.5 million barrels per day at the start of 2018.
The oil joker
Citigroup Inc. has described Iran as the biggest wildcard for the oil market this year, although there is no certainty that a deal with the United States will come to fruition anytime soon that would result in increased exports. . President Joe Biden has offered to participate in talks to revive the nuclear deal, but Tehran wants US sanctions lifted first. Europe recently said it would try more actively to relaunch the pact.
While Iranian oil exports are still subject to sanctions, shipments have increased and flows to China have received unwanted attention. India is also hoping Biden will take a softer line against Iran so that the world’s third-largest oil importer can diversify its sources of crude.
Beijing opposed the sanctions and accused the United States of going beyond its jurisdiction. Washington claims Iran is disguising the origin of its crude to circumvent sanctions and the Justice Department recently seized 2 million barrels of crude aboard a Greek tanker, claiming the owner was tricked into believing that the oil came from Iraq.