Japan Traders to Resume Iran Oil Imports
Japanese traders including Marubeni Corp and Sumitomo Corp that stopped buying Iranian oil during sanctions are looking to resume imports, potentially by the yearend, industry sources said.
Conservative Japanese firms have so far held off taking Iranian crude due to a lack of internationally acceptable insurance coverage, but are looking at ways of using cover provided by the Japanese government, the sources said, Reuters reported.
The traders seeking to restart purchases together imported around 50,000 barrels per day of Iranian oil before sanctions were imposed and renewed purchases would give a boost to Tehran's aim of increasing its exports to 4 million bpd.
Other Asian buyers have stepped up purchases of Iranian oil since sanctions were lifted in January, with Iranian imports to Asia, excluding Japan, jumping to 1.60 million bpd in August, up 92% on a year ago.
Trading houses have been waiting for private shipping insurance to return to full coverage, which could come as early as this year. But some traders now hope to piggyback on a Japanese government scheme that has been providing ongoing cover for so-called "essential" imports of Iranian oil throughout the sanctions. The government-cover enabled refiners and trading houses such as Mitsubishi Corp and Toyota Tsusho to import Iranian oil even after the sanctions were imposed in 2012.
"One solution would be to co-load oil with other buyers," said a source with a trading house. Oil loaded on vessels already covered by the government scheme would also be fully insured, they said.
Earlier this month, Mitsui & Co resumed taking Iranian oil for the first time since at least 2012, co-loading Iranian condensate with a major Japanese refiner on a tanker, a source familiar with the shipping schedule said. Mitsui declined to comment.
Marubeni, which bought Iranian crude, condensate, naphtha and fuel oil until 2012, confirmed it had been working to restart purchases. A company source told Reuters it hoped to resume imports by the end of the year.
Sumitomo, which bought liquefied petroleum gas from Iran before the sanctions, was also looking to buy Iranian oil and LPG as long as prices were competitive, an industry source close to the matter said.