Sanctions cut Iranian crude exports from around 2.5 million bpd before 2011 to just over 1 million bpd in recent years.
However, Iranian officials have unusually included the sales of gas condensates in their latest oil export data. The move is unlike the trend at the Organization of Petroleum Exporting Countries that includes crude but not condensate in production reports.
However, there is no widely-accepted touchstone for including or excluding the condensate in sales figures. For instance, South Korea’s crude oil import data usually include condensate, without giving a breakdown.
Another reason that complicates the inclusion of condensate in oil output is the nature of condensates. Condensates and natural gas liquids occupy an intermediate position in the spectrum of hydrocarbons, which ranges from natural gas at one end to blends of heavy crude oil at the other.
Earlier this month, Oil Minister Bijan Namdar Zanganeh said Iran’s combined oil and gas condensates exports reached 1.75 million bpd in February, adopting a similar approach in giving an account of the country’s closely-watched crude supplies in the post-sanctions period.
Reuters cited two industry sources on Thursday as saying that the Islamic Republic’s net oil exports are expected to reach 1.65 million barrels a day in March, a far cry from the country’s own data.
Oil Deals
Qamsari said France’s Total is the only oil major that has reached an agreement to ship Iranian crude oil, dismissing speculations on oil deals with other major players.
“We have not signed a contract with Shell, BP or any other European major but Total,” he said in a radio interview.
Qamsari added that NIOC is in ongoing negotiations with several high-profile companies to sell Iran’s crude.
Iran has set its sights on European refiners to ramp up crude exports despite a growing supply glut and producers pumping at record levels to defend market share.
The company made its first large oil shipment to Europe in February, after sanctions against it were officially lifted on Jan. 16 following a watershed agreement with six world powers on its nuclear program in July last year.
According to reports, Total bought 2 million barrels of oil from Iran last month, with Russia’s Lukoil and Spanish refiner Cepsa each taking in 1 million barrels.
Insurance Hurdles
Iran’s crude shipments, particularly to Europe, have been complicated by a lack of clarity on ship insurance, US dollar clearance and European banks’ letters of credit.
In a statement earlier this week, Qamsari said Iran cannot fulfill its export goals just yet because it is still grappling with restrictions on the insurance of its oil shipping.
Qamsari said Iran is trying to obtain the agreement of the International Group of Protection & Indemnity Clubs for insurance coverage, but so far only nine members of the 13-member group have agreed to cover the insurance risk of Iranian tankers, Trend said in a report.
The organization protects more than 90% of the world’s crude carriers against risks, which include spills.
Qamsari said many Iranian oil buyers demand insurance covered by members of the International Group of P&I Clubs for Iranian tankers, which is currently not possible. He added that it is not clear when the problem will be settled.
“Iran is using Kish P&I, for insurance on existing shipments to India, China and Turkey,” he added.
