October 18-2013
Iranian oil exports rose slightly to 1.17 million barrels a day last month, but still remain well below half the level that prevailed in the previous two decades, according to the monthly report of the International Energy Agency (IEA).
Export levels have floated up and down this year but have averaged just barely over 1 million barrels a day for the nine months of 2013 so far. That is 60 percent down from the 2.5 million barrels a day that prevailed from the early 1990s until late 2011 when the slide began under the pressure of the US.
The real disaster began in July 2012 when the EU stopped buying any Iranian crude and barred European firms from insuring or re-insuring any Iranian oil cargoes.
According to the IEA, which is a grouping of about three dozen oil importing countries, Iran sold oil in September to six countries—the standard five that have continued buying oil under US exemptions from sanctions plus Pakistan, which bought one small cargo. Iran’s oil exports last month were (in thousands of barrels a day):
China 555 49%
India 265 23%
Japan 155 13%
Turkey 100 9%
S.Korea 65 6%
Pakistan 30 3%
The 1.17 million barrels a day in September was a rise from .99 million barrels in August, the IEA said. The entire increase was due to rising Chinese and Indian imports. Those two countries together accounted for 70 percent of all Iranian oil sales in September.
Pakistan’s order was its first for Iranian oil since January 2011.
For unexplained reasons, the Indian government allowed its 90-day special insurance provision for Indian imports of Iranian oil to expire on September 27. As a result, some Iranian tankers carrying oil for India were not allowed into Indian ports and had to anchor at sea. Iran announced that the insurance coverage was renewed October 11 for 90 days. But there has still been no explanation for the two-week gap.
The insurance for ships covering Iranian tankers carrying Iranian oil to India covers liabilities from $50 million up to $1 billion per incident. Liabilities below $50 million are covered by Iranian insurance.
Meanwhile, monthly data published by Platt’s showed Iran pumped a little over 2.7 million barrels a day in September, with most of the production destined for domestic consumption.
Production has hovered around 2.7 million since July 2012, when the EU sanctions took effect. Before that, Iranian production had been sliding slightly almost every month in recent years as Iran’s ability to pump eroded because new production could not keep up with the inevitable decline in output from Iran’s many aging oilfields.
The Islamic Republic does not admit to that slide in production capacity, which is presumably somewhere below 3.5 million barrels a day now. It claims production capacity in excess of 4 million barrels a day.
