Iran finds innovative ways to beat sanctions and keeps oil flowing
A vessel carrying 2 million barrels of Iranian oil was reported on Tuesday to have discharged the crude into a bonded storage tank at the port of Dalian in northeast China.
Keeping oil in bonded storage gives the shipment owner the option to sell into China or to other buyers in the region, Reuters news agency reported.
Three other very large crude carriers, operated by National Iranian Tanker Company (NITC), are set to arrive in Dalian in the next week or two, it said.
China has pledged to ignore US sanctions and keep buying Iranian oil. India and Turkey have also dismissed the unilateral American measures. China and India are the first and second biggest customers of Iranian oil, while Turkey is the biggest buyer of Iran’s oil in Europe.
Indian Oil Minister Dharmendra Pradhan said on Monday two leading oil companies of the country have placed orders to import Iranian crude next month in spite of the US sanctions.
Pradhan told ‘The Energy Forum’ in New Delhi that the world’s third-largest oil importer was not waiting to see whether it would receive a waiver from US sanctions or not.
India imported around 10 million barrels of Iranian crude in October. According to Reuters, state-owned Indian Oil plans to purchase 6 million barrels of Iranian oil next month, while Mangalore Refinery and Petrochemicals will buy 3 million barrels.
Pradhan said New Delhi is also working out a different payment system to buy Iran’s oil that will include using Indian rupees.
Russia and China are both pursuing their own systems and Germany has suggested creating Europe’s rival to global financial messaging service SWIFT based on the euro rather than the dollar in order to bypass US sanctions.
Russia says it will intensify work with Iran, Europe and China in coming days to counter unilateral US sanctions.
On Monday, British daily the Financial Times said European finance ministers will meet US Treasury Secretary Steven Mnuchin in Bali this week and pressure him on allowing Iran to have access to SWIFT.
According to the report, France, Germany and the UK are frustrated with the Trump administration’s hard line on the matter. The paper quoted a European diplomat as saying that the disagreement over SWIFT was heading for ‘a diplomatic train wreck’.
Iran says its oil flow to the market should not be hampered no matter what as Western oil news and information providers are steadily claiming declines in Iran’s exports, putting them at about 1.7 million bpd ahead of the sanctions.
That is an 11 percent decline from August, but data from global oil shipments and storage service provider TankerTrackers.com puts the export volume north of 2 million bpd.
The discrepancy of 300,000 bpd in the statistics attests to an underlying campaign to create the sense that Iran’s exports are dropping fast, with some market analysts even claiming the losses were faster than they expected.
Underlining the resilience of Iranian exports is the pledge by officials that the country will go full throttle in its production.
‘Despite the mischief of the Americans, Iran’s oil exports have surpassed state budget outlay projections,’ Vice President Es’haq Jahangiri said last week.
‘Notwithstanding all the pressures that the Americans are creating on the oil issue, Iran has its own oil customers, and the work is going on in a way that no problems will arise,’ he told a parliament session in Tehran.
Even Russia is helping Iran despite being virtually an energy rival. On Monday, Russian Foreign Minister Sergei Lavrov and his Iranian counterpart Mohammad Javad Zarif discussed energy cooperation in a telephone call.
‘The two top diplomats discussed bilateral cooperation, focusing on the energy sector,’ the Russian Foreign Ministry said in a statement.
Source: NIOC – National Iranian Oil Company