Published: Thu, October 25, 2018
Money | By Wilma Wheeler

Iran Claims Its Oil Exports 'Unstoppable'

Iran Claims Its Oil Exports 'Unstoppable'

Saudi Arabia has already boosted its daily output to well over 10.5 million bpd to meet rising demand in the wake of several production disruptions in other countries.

The National Iranian Oil Co did not immediately respond to an email seeking comment.

Indian Oil Corporation (IOC) and Mangalore Refinery and Petrochemicals Ltd (MRPL) have reportedly placed order for 1.25 MT of crude oil from Iran. "That basically means Iran will have to stop importing from China", said an executive with an eastern China-based manufacturer that exported electronic components to Iran until recently. There have been reports that companies in different parts of the world would defy sanctions and continue buying Iranian oil.

Last month, the price of crude oil rose sharply as investors braced for low supplies after Iran's oil is cut off.

Top U.S. lawmakers turned their ire on Saudi Crown Prince Mohammed bin Salman on Sunday and said they believed he ordered the killing of Khashoggi, although the administration of U.S. President Donald Trump maintained a more cautious stance.

In relevant remarks earlier this month, Iranian Foreign Ministry Spokesman Bahram Qassemi said the country has launched talks with other nations and already formulated the necessary mechanisms to foil the USA attempts at bringing Iran's oil exports to zero with new sanctions.

Abhishek Kumar, senior energy analyst at Interfax Energy, echoed the sentiments of many in the analytical community by stating, "It is still not a foregone conclusion that the kingdom's production increase will be enough to compensate for the potential output loss from Iran and Venezuela".

Brent crude oil, the worldwide benchmark, extended its decline to 4.5%, or $76.30 a barrel, around midday.

United States has been significantly increasing its crude oil production and exports since 2016 amid increase in crude oil prices and tightening of supply market.

According to data from ClipperData, Iran's exports of crude oil and condensate peaked in June at about 2.7 million bpd, more than 300 000 bpd higher than the average during the first four months of the year (before the May announcement of sanctions). This was much higher than the 3.9 million barrels that traders were expecting. "That policy has been consistent for many years", Falih said.

Oil prices have rallied this year on expectations that the sanctions will strain supplies by lowering shipments from Iran, OPEC's third-largest oil producer.

There was news that Iran shipped over 20 million barrels of oil to China's north-eastern port of Dalian against the 1-3 million barrels it typically receives each month.

The U.S. Energy Department said gasoline stocks fell 4.8 million barrels to 229.3 million barrels last week, the lowest since December 2017.

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