Iran Prepares Sale Of 44-M BBL Crude Stored At Sea


Iran is storing as much as 44-M bbl of on supertankers at Sea as it prepares for a sales drive if a nuclear deal can be sealed.

Iran and the 5P+1 world powers are seeking to overcome last differences by 30 June deadline to reach a deal over Iran’s disputed nuclear program.

In the meantime, Iran is parking Crude Oil off its coast, mainly on belonging to its national carrier NITC.

“The 1st thing they will try and do is offload a lot of that storage. Bijan  Zanganeh has warned to make room for us. In other words, we are going to sell this oil at any price,” said a former official at the state-run National Iranian Oil Co.

“Floating storage is there to be put onto the market as soon as possible after some sort of agreement,” said the former official who now runs an energy consultancy in the UK.

Iran, once OPEC’s 2nd-largest producer after Saudi Arabia, is seeking to clear space for its gradual return to the market after years in which Western sanctions have cut its Crude Oil exports to as little as 1-M BPD.

It actually makes sense for Iran to go in fairly hard in order to reclaim market share and hope that high cost producers above them are inched out quicker.

Shipping sources and tanker tracking data show that over the past 3 months Iran had deployed at least 15 very large Crude Oil carriers (VLCCs), each capable of carrying 2-M bbl, to store Crude Oil.

HeffX-LTN’s sources say that Iran is storing over 44-M bbl of Crude Oil on 23 tankers not including a few vessels that are not part of NITC’s fleet. That compares with 25-M bbls stored on 12 to 14 tankers a year ago, a major increase Y-Y.

amber_london2 NITC tankers, Amber and Nancy, have been deployed for floating storage in recent weeks, tracking data shows. Among the non-NITC vessels being used for storage is Iran-flagged tanker Daryakaran.

The International Energy Agency (IEA) said in a report last week that preliminary tanker tracking data showed Iran’s Crude Oil sales rose in May to 1.4-M BPD + 235,000 BPD from April and were at their highest since June 2012, the last month before tough financial measures were imposed by the West.

Iran’s tanker arm NITC is blacklisted by the United States and the EU. The fleet carrying capacity of over 76-M bbl of Crude Oil, it is not insured.

In the context of the financial sanctions, there are Key problems on the insurance side. And from that point of view, it will be very important for Iran to have as many tankers of their own ready to go and ready to deliver.

Analysis for OIL:OverallShortIntermediateLong
Neutral (0.09)Neutral (0.22)Neutral (-0.10)Neutral (0.14)

Have a terrific week.