Asian imports of Iran oil in May hit highest level in 2015

An oil refinery is seen in Shanghai. Imports by Iran’s four biggest oil buyers – China, India, Japan and South Korea – totalled 1.2mn bpd last month, down 1.9% from a year ago and the highest since 1.21mn bpd in December, government and tanker-tracking data showed.Reuters/TokyoAsian imports of Iranian crude rose to the highest level this year in May, although buyers may have to curb any further increases if negotiators up against a deadline fail to reach a final deal on Tehran’s disputed nuclear programme.A deal between Iran and six world powers would resolve a 12-year standoff over the Islamic nation’s nuclear work in exchange for relief from sanctions, which could eventually send millions of barrels flooding into an already saturated market.Iran has as much as 40mn barrels of oil stored in tankers and aims to increase output by 500,000 barrels per day (bpd) within a month of sanctions being lifted and up to 1mn bpd within six or seven months.Iran, the US, Britain, France, Germany, Russia and China reached a tentative framework for a nuclear pact on April 2 but several issues remain unresolved. They have a self-imposed June 30 deadline to arrive at a comprehensive agreement and talks are now expected to stretch into July. “I think we will probably have to wait six months till we see officially sanctioned exports out of Iran going forward,” said David Fyfe, head of market research and analysis at Gunvor in Singapore.Imports by Iran’s four biggest buyers – China, India, Japan and South Korea – totalled 1.2mn bpd last month, down 1.9% from a year ago and the highest since 1.21mn bpd in December, government and tanker-tracking data showed.The imports have been slowly creeping up this year, but a failure to reach a deal this week would likely mean monthly shipments would be brought back closer to the about 1mn bpd currently allowed by sanctions. Iran is keen to recover market share lost under the US and European Union sanctions that curbed its exports to around that level by the end of 2013, from 2.5mn bpd in 2011.“If oil-related sanctions are lifted, Iran will look to regain export market share, competing with other Opec members,” said Alexander Metelitsa, analyst at the US Energy Information Administration (EIA). Over the first five months of 2015 Asian buyers took in just over a million bpd. In May, all buyers except China increased their purchases of Iranian oil, with the Chinese shipments hitting the lowest in four months as overall crude imports dropped during the country’s spring refinery maintenance season. Japan’s purchases rose 5% in May from a year earlier to 190,924 bpd, trade ministry data showed yesterday. South Korean imports nearly doubled, according to data released earlier.India’s imports of Iranian crude oil rose 66% from a year earlier in to their highest level since March 2014. Two months earlier India had imported no oil from Iran for the first time in at least a decade.