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NIOC to Boost Export of Cleaner Diesel

NIOC to Boost Export of Cleaner DieselNIOC to Boost Export of Cleaner Diesel

Iran is aiming to increase the export of cleaner diesel next year, as its refineries are upgraded, even as it cuts its reliance on imports, industry sources familiar with the matter said on Tuesday. The country has expanded its presence in the global oil market after international sanctions were lifted in January, aggressively marketing and increasing diesel shipments.

The additional supply may add to a diesel supply glut in Asia, Reuters reported. Diesel exports from the National Iranian Oil Company containing 500 parts-per-million of sulfur will likely make up about half of its overall diesel shipments from early next year, compared with about less than 10% currently, one of the sources said.

It currently ships out about 500,000 tons of gasoil with 1% sulfur, or 10,000 ppm, which is mainly exported to the Middle East, with small volumes sent to Singapore, Africa and the Mediterranean, the source said, declining to be named as he was not authorized to speak with the media.

“(NIOC) is aiming to increase its low sulfur (diesel) exports and reduce high sulfur to about 50-50 as refineries are upgrading,” he said.

“The company ceased the import of gasoil from April 2015 and was balanced with its supply and demand until January when it stepped up the fuel’s export.”

The volumes are sold through spot and term contracts, he added, declining to reveal details of term buyers. Iran’s increase of cleaner diesel is expected to weigh on Asian gasoil margins, which are already hovering near six-year lows, traders said.

Financialtribune.com