South African Oil Imports From Iran Drop as Sanctions Loom

South Africa has been reducing oil imports from Iran before next month’s U.S. deadline to impose sanctions against the Middle Eastern nation over its nuclear development program.

South Africa received shipments of crude worth 1.8 billion rand ($211 million) from Iran last month, down from 2.93 billion rand in April 2011, the South African Revenue Service said today in an e-mailed statement. In March, oil imports from Iran totaled 3.37 billion rand, 63 percent more than in the same period a year earlier.

U.S. President Barack Obama signed a law on Dec. 31 that denies access to the U.S. financial system to foreign banks that do business with the Central Bank of Iran. The U.S. may impose penalties should a country not make “significant” reductions in Iranian crude oil purchases by June 28. Governments may apply for a 180-day renewable exemption from the sanctions.

The issue wasn’t discussed at a Cabinet meeting yesterday, government spokesman Jimmy Manyi said in an interview today in Cape Town. South African Energy Minister Dipuo Peters said May 17 that the government would draw up a response to the sanctions by the end of this month.

Iran’s nuclear development program has sparked accusations from the U.S. and the European Union that enriched uranium may be diverted to produce weapons.

South Africa’s crude imports totaled 8.31 billion rand in April, with 22 percent coming from Iran, 56 percent from Saudi Arabia and 23 percent from Nigeria, the revenue service said. Oil shipments from Iran increased 5 percent to 7.95 billion rand in the first four months of the year.

Petroliam Nasional Bhd.’s Engen unit, which was the biggest South African importer of Iranian crude, said April 4 it suspended imports of oil from Iran.

The suspension remains in place and alternative supplies of crude have been sourced, Engen spokeswoman Tania Landsberg said in an e-mailed response to questions yesterday.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE