Iranian Crude Sales Fall to 21-Month Low as Biggest Buyers Cut

Iran, the fifth-largest crude exporter as recently as 2011, sold the least in 21 months in October as China, India, South Korea and Japan curbed purchases amid Western sanctions targeting the nation’s nuclear program.

Imports from the Persian Gulf state fell by 45 percent to 715,000 barrels a day last month from September, the International Energy Agency, a Paris-based adviser to 28 nations, said in an e-mailed report today. The shipments, which the IEA estimates from tanker tracking, media reports and customs’ data, would be the smallest since January 2012.

U.S. sanctions from the start of last year meant buyers of Iranian oil had to limit purchases or risk having their banks excluded from America’s financial system. Almost all the world’s tankers were barred from hauling the Gulf state’s fuel six months later when European Union rules took effect because the ships were insured by companies following EU law. The West suspects Iran is building nuclear sites for military purposes, while Tehran says the program is for civilian purposes.

“Signs are emerging that the National Iranian Oil Co. is finding it increasingly difficult to place barrels against the backdrop of sanctions,” the IEA said.

The nation’s daily sales to China slid to 300,000 barrels from 475,000 in September, the IEA said. Supplies to India slumped to 165,000 barrels from 300,000 barrels; deliveries to Japan declined to less than 100,000 barrels from 250,000 barrels and those to South Korea fell to 65,000 barrels from 135,000, according to the agency. It counts shipments based on when they are imported by the receiving country.

Discount Prices

Iran is trying to sell more crude to India by offering to deliver cargoes for free, equating to price discounts of about $1 a barrel, the IEA said.

Declining sales prompted the Islamic republic to move about 300,000 barrels a day onto tankers for storage, according to the IEA. The total amount of unsold crude on ships is 37 million barrels, it said. About 6 million barrels are being stored off Chinese ports, the agency estimated.

Iran exported $84.4 billion of crude petroleum oils in 2011, according to ITC TradeMap, a venture between the United Nations and World Trade Organization. Saudi Arabia, Russia, the United Arab Emirates and Nigeria all had bigger sales by value. Iran ranked 12th last year with sales of $$52.7 billion.

To contact the reporter on this story: Alaric Nightingale in London at anightingal1@bloomberg.net

To contact the editor responsible for this story: Alaric Nightingale at anightingal1@bloomberg.net

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