The National Iranian Oil Company’s crude and gas condensates exports have experienced a massive 430% growth between 2020 and 2022, a senior oil analyst at Kepler International Company, a leading provider of intelligence solutions for commodity markets, said.
“The state-run firm is now selling five times more oil cargos compared to 2020 because not only has the Covid-19 pandemic ended, but also US President Joe Biden's administration has adopted more flexible policies toward Iran in comparison to the former US president, Donald Trump's administration,” Homayoun Falakshahi was also quoted as saying by ILNA.
Iran exported close to 2.5 million barrels of oil per day in 2018, prior to US sanctions on the regime, which plummeted to 330,000 barrels per day in 2020, he added.
The official noted that when the pandemic subsided and global demand surged, NIOC’s sales figures doubled in 2021 and reached 700,000 barrels per day.
According to Falakshahi, the upswing continued and exports reached 1 mbd in the first quarter of 2022.
“The company’s exports hit a record 1.2 mbd last October and remained the same till May, 2023, when Iran sold close to 1.6 mbd, a fivefold hike compared to 2020 and the highest record since 2018,” he said.
Global oil demand plunged from 100 mbd in 2018 to 91 mbd in 2020 due the outbreak of the pandemic. However, as the pandemic waves subsided, global demand for oil rose and reached 96 mbd and 100 mbd in 2021 and 2022 respectively.
Chinese private refiners are Iran's biggest customer while volumes also head to Syria and Venezuela, according to the analysts.
Independent Refiners
Unlike 2018 when China’s state-run oil companies like China National Petroleum Corporation imported 80% of their demand from NIOC, these days only independent refiners, also referred to as teapots, can purchase Iran’s crude.
“These firms account for 90% of Iran’s total oil sales and the rest is sent to Syria and Venezuela.”
Commenting on the US energy policies, he noted that President Vladimir Putin’s decision to attack Ukraine one year ago roiled energy prices and the US administration did not have a choice but to be more flexible and allow Iran and Venezuela to increase their international sales so that energy prices would not soar.
According to Falakshahi, Russia is selling its oil at $10 per barrel lower than international prices, so NIOC has to give more discount to its customer to be able to attract more buyers.
Refuting NIOC’s claim regarding selling oil to Germany, he argued that as long as the US sanctions are in place, no European state will be able to make a deal with Iran.
Nonetheless, if and when sanctions are lifted, European refiners will be willing to buy from NIOC as Iran’s crude is very similar to the oil that they used to import from Russia prior to the Ukraine conflict.
The International Energy Agency this week put Iran's May production at 2.87 million bpd, close to Iran's official figure.
The rise from Iran comes as OPEC+, which includes OPEC, Russia and other allies, is cutting output to support the oil market, where expectations that economic weakness will dent demand have pressured prices.
Other analysts say Iran's production and exports have risen.
SVB International, a consultant, estimates crude production hit 3.04 million bpd in May, up from 2.66 million bpd in January.
Floating Gas Condensate
Iran’s floating gas condensate inventory has reduced substantially, owing to exports and higher domestic consumption over the last two years, Oil Minister Javad Owji said.
“In 2021 when the 13th government, led by President Ebrahim Raisi, took office, we had concerns about the piling gas condensates as 78 million barrels were floating in our ships, but now the massive stockpile has almost reached zero," he added.
Owji said the National Iranian Oil Company took effective initiatives and raised the export of gas condensates to a record high since May 2019, noting that floating gas condensates were exported and used domestically.
The oil minister said Iran has sold several cargoes of gas condensates to fellow OPEC member Venezuela and also increased its energy sales despite a US campaign to minimize it.
"Fortunately, our exports of crude oil, gas condensates, natural gas, oil products and petrochemicals have reached a very acceptable figure," Owji said, without giving details.
Iran has been subject to sanctions on its energy sector since 2018, when the US administration withdrew from a nuclear deal with Tehran and reimposed restrictions on the country's economy.
According to data from NIOC, Iran earned close to $40 billion by selling crude and petroleum byproducts in the last fiscal year that ended on March 20, 2023.
The country’s income from exporting petrochemical goods reached $14 billion last year.
