Iran taps old oil customers as Tehran eyes lifting of sanctions
Iran is reaching out to old customers in Asia to gauge their interest in buying its oil as Tehran ramps up diplomacy to get US sanctions lifted.
The National Iranian Oil Company (NIOC) has approached at least five refiners across the region to discuss the possibility of supply deals if sanctions are eased, according to people familiar with the matter, Bloomberg reported on Wednesday.
Talks are preliminary, with no discussion on volumes or prices yet, the sources said, asking not to be identified because the information is confidential.
One processor has been contacted twice this year after having no interaction with the OPEC producer at all in 2020, according to one person.
Iran’s crude shipments declined after former US president Donald Trump tightened draconian sanctions from mid-2018 and ended waivers for some countries in 2019.
Still, a number of Chinese refiners continued to take some oil. Prior to the penalties, 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 a day (mbd) in early 2018.
Citigroup Inc. has described Iran as the biggest wildcard for the oil market this year, though there’s no certainty a deal with the US will materialize anytime soon that would lead to higher exports.
US President Joe Biden has offered to participate in talks to revive the nuclear accord, but Tehran wants US sanctions to be lifted first.
Europe said recently it will be more active in trying to revive the pact.
While Iranian oil exports are still subject to sanctions, shipments have been creeping up and flows to China have received some unwanted attention, according to Bloomberg.
India is also hoping Biden takes a softer line against Iran so that the world’s third-largest oil importer can diversify its crude sources.
Beijing opposed the sanctions and accused the US of reaching beyond its jurisdiction.