MOSCOW (MRC) -- Asian refiners, traditionally big buyers of Iranian oil, are keen to resume imports from Iran if there is an agreement to revive a 2015 nuclear deal, which could pave the way for more supply on global markets and soften prices, said Hydrocarbonprocessing.
Most Asian buyers halted Iranian oil imports in 2019 after former U.S. President Donald Trump withdrew from the nuclear deal with Iran and re-imposed sanctions on Tehran's oil exports. Indirect talks between Iran and the U.S. on the nuclear deal resumed last week. Western diplomats have indicated they hoped to have a breakthrough by now, but tough issues remain unresolved.
Oil prices are at their highest in more than seven years as fears of disruption in Russian energy supplies have boosted Brent and U.S. crude futures. Refiners are also paying record spot premiums for crude produced in Europe and the Middle East as producers struggle to meet a robust recovery in demand after the pandemic.
With the prospect of a new Iran deal, South Korea, previously one of Tehran's leading oil customers in Asia, said on Wednesday it had held working-level talks on resuming imports of Iranian crude oil and unfreezing Iranian funds. A major South Korean refinery is watching the developments at the nuclear talks, a company source said, as Iranian crude oil is cost-competitive and easy to process compared with other grades such as Mexican oil.
"As long as the two countries decide to resume oil trade, we can purchase crude from Iran," this source said. "Since we've previously used crude oil from Iran, we don't need to test the oil at our facilities," he added. Japan's top refiner Eneos Holdings Inc will consider resuming oil imports from Iran if an agreement to revive a 2015 nuclear deal is reached, its chairman said on Thursday.
"We have not begun such preparations yet, but we will consider resuming imports of crude oil from Iran as one of our procurement options if an agreement over the nuclear deal is reached," Eneos Chairman Tsutomu Sugimori told reporters. It will take about two-to-three months to resume oil imports from Iran if and after such an agreement on the nuclear deal is made as the refiner will need to make various arrangements such as insurance and shipping, Sugimori said.
A refiner from India, Iran's number two customer, is in talks with Iran for sourcing its oil, an Indian refining source said, adding that it was also waiting for more clarity on the nuclear deal. The sources declined to be identified due to sensitivity of the matter. Iran has kept some exports flowing despite sanctions as intermediaries find ways to disguise the origins of the imports and China, Iran's biggest customer, has been a big destination.
Last month, China's customs reported the first import of Iranian crude in a year. Russia-Ukraine tensions have raised volatility in global oil prices, but positive developments in the U.S.-Iran negotiations have raised hopes of Iranian oil returning to markets, helping to calm oil prices, Claudio Galimberti, Senior Vice President at Rystad Energy said in a research note.
As MRC informed earlier, Indian Oil Corp, the country's top refiner, said that it would resume purchases of Iranian oil if Washington lifts sanctions against Tehran over its disputed nuclear programme. The European Union official leading talks to revive Iran's nuclear deal said on Wednesday he was confident an agreement would be reached as the negotiations adjourned, although European diplomats said success was not guaranteed with very difficult issues remaining.
As MRC informed previously, in the first week of June, 2021, Eneos Corp restarted the 168,000-bpd No.1 CDU at its Kashima refinery, east of Tokyo, after it was shut on May 11 due to system trouble. The refiner, which is a unit of Eneos Holdings Inc, restarted the 105,000-bpd No.3 CDU at its Mizushima-B refinery, western Japan, in early June, 2021. The CDU was shut on Feb. 25 for turnaround.