South Korea's May Iran Crude Imports Decline

South Korea’s Iranian crude oil imports fell in May to their lowest since January 2016, as South Korean buyers sought to reduce purchases of Iranian oil amid new US sanctions on Iran.

In May, South Korea imported 758,903 tons of Iranian crude, or 179,444 barrels per day, versus 1.02 million tons last year, customs data showed on Friday. That was the lowest since January 2016 when South Korea imported 859,223 tons, Reuters reported.

South Korea, the world’s fifth biggest crude importer, mainly buys an ultra-light oil known as condensate from Iran. However, its intake of Iranian oil has been on the decline in recent months with the launch of a new condensate splitter in Iran and lower production.  Against this backdrop, US President Donald Trump said in early May that the United States would walk away from an international nuclear deal with Iran and impose renewed US economic sanctions on Tehran, sparking concerns about buying Iranian oil.

South Korea said it would seek exemptions from the United States following the US move. South Korea had previously managed to get a waiver on US sanctions by curtailing oil imports from Iran. For the first five months, South Korea’s oil imports from Iran fell 33% to 5.45 million tons, or 264,369 bpd, compared with 8.12 million tons in the same period of last year, according to the customs data.

Overall, South Korea’s total May crude imports were 12.69 million tons, or roughly 3 million bpd, up 2.5% from 12.38 million tons last year. Crude imports from Saudi Arabia, South Korea’s top crude supplier, fell 23.6% to 3.23 million tons, or 763,620 bpd, year-on-year.

On the other hand, South Korea’s imports of US crude in May showed a nearly threefold increase at 405,158 tons, or 95,800 bpd, from 141,162 tons a year ago. Oil shipments from Russia also jumped in May, up 78% to 922,664 tons, or 218,165 bpd, from last year.

In the first five months of 2018, South Korea imported 60.97 million tons of crude, or 2.96 million bpd, up 0.7% from 60.56 million tons during the same period in 2017, according to the data.

South Korea’s final May crude imports data will be released by state-run Korea National Oil Corp later this month.