Iran Cuts Crude Export Prices to Asian Buyers for February
Iran, the second-largest producer in the Organization of Petroleum Exporting Countries, cut the price of crude supplies loading in February to Asia relative to benchmark levels, said an official at National Iranian Oil Co.
NIOC lowered Iranian Light (AOSPLTAS) exports to a premium of $2.26 a barrel above the average of Dubai and Oman oil, said the official, who asked not to be named, citing company policy. That compares with $4.36 for January. Iran Heavy, Forozan, Norooz and Soroosh were also lowered.
Iran pumped 3.58 million barrels a day of crude last month, according to Bloomberg estimates. The Persian Gulf nation has threatened to block the Strait of Hormuz in response to U.S. and European sanctions aimed at reducing Iranian oil revenues. The waterway carries 17 million barrels of crude a day, according to the U.S. Energy Department, almost 20 percent of global consumption.
U.S. Treasury Secretary Timothy F. Geithner is visiting China and Japan this week to seek support for sanctions against Iran and lobby for a curtailment of crude purchases from the country. The Asian nations are the largest importers of Iranian oil, with China accounting for 22 percent and Japan buying 14 percent during the first half of last year, according to the U.S. Energy Information Administration.
Iran Pricing
Producers such as Saudi Arabia and Iran sell the majority of their crude under long-term contracts to refiners. As the largest producer in the OPEC, Saudi Arabia creates the standard for the region. NIOC pegs selling prices to Saudi Arabian grades for Asian customers using differentials that are adjusted quarterly. For the first quarter, NIOC set Iranian Light 21 cents above Saudi’s Arab Light. Iranian Heavy cost 1 cent below Arab Medium and Forozan 17 cents above the same grade.
The following table gives differentials of Iranian crude supplied to five regions in relation to benchmark prices and the month-on-month change. Prices are in U.S. dollars a barrel.
Asia Grade February January Change Iranian Light +2.26 +4.36 -2.10 Iranian Heavy +0.74 +2.74 -2.00 Forozan Blend +0.92 +2.92 -2.00 Soroosh -4.19 -3.89 -0.30 Norooz -4.19 -3.89 -0.30 Prices for customers in Asia are expressed as a differential to the average of the Oman and Dubai benchmark assessments published by Platts, except for Soroosh and Norooz, which are priced against Iranian Heavy. ---------------------------------------------- Northwest Europe Grade February January Change Iranian Light -2.35 -0.80 -1.55 Iranian Heavy -3.85 -2.30 -1.55 Forozan Blend -3.75 -2.20 -1.55 Prices for customers in Europe are expressed as a differential to the Intercontinental Exchange’s Brent weighted average. ---------------------------------------------- Mediterranean Grade February January Change Iranian Light -4.00 -2.00 -2.00 Iranian Heavy -5.45 -3.85 -1.60 Forozan Blend -5.35 -3.75 -1.60 Soroosh -4.00 -3.85 -0.15 Norooz -4.00 -3.85 -0.15 Prices for customers in the Mediterranean are expressed as a differential to the Intercontinental Exchange’s Brent weighted average, except for Soroosh and Norooz, which are priced against Iranian Heavy. ------------------------------------------------------------- Sidi Kerir Grade February January Change Iranian Light -1.90 -0.05 -1.85 Iranian Heavy -3.35 -1.90 -1.45 Forozan Blend -3.25 -1.80 -1.45 Prices for Middle East customers are expressed as a differential to the Intercontinental Exchange’s Brent weighted average. --------------------------------------------------------------- South Africa Grade February January Change Iranian Light -2.35 -0.80 -1.55 Iranian Heavy -3.85 -2.30 -1.55 Forozan Blend -3.75 -2.20 -1.55 Prices for customers in South Africa are expressed as a differential to the Intercontinental Exchange’s Brent weighted average.
To contact the reporter on this story: Ramsey Al-Rikabi in Singapore at ralrikabi@bloomberg.net
To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net
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