Iran's Condensate Stock in China Runs Out

Iran has sold its entire inventory of gas condensates in China, the Oil Ministry's official news agency, Shana, reported on Monday. Iran had stored up 10 million barrels of condensates in China as part of efforts to expand its presence in the world's second-largest energy market, the report said.

Tehran turned to leasing oil storage tanks in China during the sanctions, making the country an export base for its petroleum products in the Far East as financial and trade restrictions had significantly curtailed Iranian oil trade and shipment. However oil exports to China were ramped up after the easing of sanctions a year ago. Beijing took in an average of 689,530 barrels of Iranian oil per day in December, the report added.

China was among the few countries which were allowed to buy crude oil from Iran under temporary waivers when the sanctions were in place. Iran produces close to 600,000 barrels per day of gas condensates – a type of ultra light crude -- the lion's share of which is sent to Asia and Europe.  Condensate output is slated to reach 1 million barrels a day upon the launch of all phases of South Pars, the giant gas field shared by Iran and Qatar. 

But Tehran looks to reduce the outbound shipments of condensates to use the fossil fuel for producing an array of products that yield higher value added. 

Condensate exports are set to decrease sharply upon the launch of several oil processing plants, including Siraf and the Persian Gulf Star Refinery, the latter described as the largest refinery project in the Middle East.