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Iran Boosts Oil Trade Via UAE

Iran Boosts Oil Trade Via UAEIran Boosts Oil Trade Via UAE

Iran has boosted fuel oil exports through the UAE and also almost doubled its imports of gasoline, although western sanctions are still in place, trading sources said.

The resumption of some direct shipments of refined oil products from Iran's Bandar Mahshahr to the UAE's Fujairah Port contrasts with the more intricate means Tehran had employed using ship-to-ship transfers and trading firms in the UAE acting as middlemen for buyers to sidestep sanctions, Reuters reported.

State-owned National Iranian Oil Company has now started to offer much more fuel and at much more attractive discounts, trading sources said.

It is also using its own ships to sail directly to Fujairah, saving buyers costly freight charges, as it becomes more proactive in anticipation of lifting sanctions next year, the sources said.

"Now because they think the sanctions are over, they are shipping more; I have seen around 6 to 7 shipments (of fuel oil) coming through Fujairah … the volumes are bigger now," said one source.

"Sometimes they use their own ships. They need to put these cargoes out even before sanctions are lifted. People are ready to buy it if they can offer $2-3 discounts on the price."

The trading sources estimated Iranian fuel oil exports at around 350,000-500,000 tons per month in September and October. "Internally, they use more natural gas for power utilities, therefore export of fuel oil is at that high level," said another trading source.

A third trading source said fuel oil shipments from Iran are being pumped into Fujairah Oil Tanker Terminal 2, but since they are then shipped from there to Asia, port regulations are less strict than if the cargoes were to remain in the UAE.

Financialtribune.com