Framework of New Oil Deal With Japan Outlined

Framework of New Oil Deal With Japan OutlinedFramework of New Oil Deal With Japan Outlined

Director of the National Iranian Oil Company elaborated on the framework of the new oil agreement between Tehran and Tokyo, a week after the two sides discussed raising Iranian crude supply to Japan in the Iranian capital.

Iran is currently the sixth biggest oil exporter to Japan, but officials say the current standing is about to change once oil embargoes are lifted.

"We can ramp up oil exports to Japan by 200,000-250,000 barrels a day in the post-sanctions period ... This will allow us to move up to become Japan's third or fourth major oil supplier," Seyyed Mohsen Qamsari told Mehr News Agency on Thursday. OPEC kingpin Saudi Arabia supplies nearly one-third of Tokyo's oil demand, with the UAE, Russia, Qatar and Kuwait trailing behind the world's biggest crude exporter.

Japan imported 10% of its oil from Iran in 2000, but sanctions have cut that figure to roughly 5% in 2014. The East Asian state's crude imports from Iran averaged 172,800 barrels per day in the first half of 2015, according to Japan’s Energy Ministry.

Qamsari stressed that Japanese oil officials "have pledged to boost demand for Iranian crude in the post-sanctions era."

"The current Tehran-Tokyo oil deal will expire in April 2016 and sanctions removal will pave the way to improve the terms of the current agreement," he said.

"The oil deal with Japan has been finalized and once the sanctions are removed, any agreement to raise the current amount of supplies will depend on global oil market and economic conditions."

Iran reached a historic deal with six world powers on July 14 in Vienna to curb its nuclear program in exchange for sanctions relief.

Japan's Ambassador in Tehran Hiroyasu Kobayashi said last week the imminent lifting of sanctions and its coincidence with the 40th year of Iran-Japan oil trade mark the opening of a new chapter in relations between the two countries that have always maintained cordial relations in recent history.

Japanese Foreign Minister Fumio Kishida arrived in Tehran earlier this week at the head of a 22-strong business delegation to explore areas of cooperation in the energy, automotive, engineering, medicine and education sectors.