Iranian oil exports are rising as Tehran avoids sanctions and finds new buyers

In the high-end, U.S.-based TankerTrackers.com, which uses satellite imagery to track deliveries, estimated that Iranian crude exports reached 1.2 million barrels a day during the fall, compared to 481,000 barrels per day in February.

Meanwhile, SVB International in Washington said Iran exported 585,000 barrels of crude per day in November, up from the previous 230,000 in 2020. Petro-Logistics increased exports to about 447,000 barrels per day, from 222,000.

More conservative figures suggest that U.S. sanctions have kept most of the Iranian crude bottled. But the sharp rise seen in the three market trackers suggests Tehran has been more successful recently in selling its oil.

Secretary of State Mike Pompeo said last year the United States was targeting zero oil exports from Iran, after trying to drive them below 1 million barrels per day, compared to pre-2018 levels of 2.5 million barrels per day.

Among the most important customers for Iran is China, which, according to official Beijing trade statistics, imported 62,000 barrels of Iranian oil a day in October, up from zero in June. Industry observers said the real totals would likely be much higher and would include the transfer of oil to other Asian countries.

Venezuela – with Socialist leader Nicolas Maduro, heavily opposed to Washington and under US sanctions – has also begun buying Iranian gasoline. And Syria resumed Iranian oil imports this year, according to maritime trackers and an Iranian oil official.

Iranian shippers have been increasingly striving to evade sanctions, turning off radio transponders to avoid tracking, while operators transporting Iranian crude have renamed their ships or become acquainted with knowledge.

More recently, oil transshipments have begun in regions that were thought to be too risky, including the coastal waters of the U.S., Iraq, and UAE allies, according to people familiar with the issue.

U.S. officials acknowledge that Iran exports oil, but say sanctions have still caused serious economic consequences for the country, including the abrupt shipment of the rial.

The Iranian currency has depreciated 85% since early 2018, while inflation of more than 30% in Iran has turned meat into a luxury product. The government’s budget cuts last year sparked protests during which hundreds died.

Pompeo has said sanctions have reduced Iran’s oil revenues by $ 70 billion since May 2018 and that reducing pressure on Tehran would be a dangerous move. In November, Keith Krach, the undersecretary of state overseeing energy policy, described U.S. sanctions on Iran as “remarkably effective.”

Iran will be one of the biggest foreign policy challenges facing President-elect Joe Biden when he enters the White House in January, and his transition team has said there will likely be policy changes, including the decision to rejoin the 2015 nuclear deal with Iran. Jake Sullivan, appointed as Mr. Biden’s national security adviser, said this month that the administration would be willing to abide by the terms of the agreement – a measure that may require a repeal of U.S. sanctions – and use it. the as a basis for follow-up speaks of broader concerns.

Most oil buyers and shippers stopped trading with Iran after Washington imposed a total embargo on Iran’s crude shipments after the Trump administration withdrew the Obama-era nuclear pact with Tehran on 2018.

Iranian traders and some potential buyers said they hoped U.S. pressure would ease once Trump left office.

An official in Italy, who was a major customer of Iranian crude, said Iranians “need to sell oil and we need energy.” Purchases will resume quickly once sanctions are lifted, the official said.

Meanwhile, resurgent Asian economies are taking advantage of the strong discounts offered by Iranian traders. An adviser to a large Chinese oil company said Iran was offering rebates of up to $ 1 a barrel per crude. Traders also sell refined products at lower prices.

Commodity trader Ali Amirliravi said Iran was offering a $ 70 discount per metric ton of propane, making it 16% cheaper than Saudi propane. According to another Iranian trader, buyers from China, India and South Korea have been looking for Iranian crude oil, which he said has been debating cargoes but has not yet completed the sale.

In March, Syria resumed Iranian oil imports after indirect pressure from the United States stopped trade. Washington forced some countries that had allowed Iranian oil tankers to register under their flag to revoke those records. Iran resumed sales to Syria by sending its own fleet of Iranian-flagged ships.

This summer, oil-rich Venezuela began buying Iranian gasoline after its refineries closed, in part because of U.S. restrictions in Caracas.

In July, the U.S. intercepted four oil tankers carrying Iranian fuel bound for Venezuela, confiscated them, and threatened Greek shippers carrying it. In September, Iran sent three of its own tankers, on which the United States has less leverage, to supply gasoline to Venezuela, according to the marine tracker Marine Traffic.

Write to Benoit Faucon to [email protected]