Iran oil exports fall closer to sanctions cap: IEA

Reuters/London

Iran’s oil exports dropped for a second month in April, the International Energy Agency said, moving closer to levels allowed by November’s interim deal on curbing Tehran’s nuclear programme.

Global imports of Iranian crude in April averaged 1.11mn bpd, the Paris-based IEA said in its monthly Oil Market Report released last week, down 180,000 bpd from March.

“Imports of Iranian crude reached a 20-month high of 1.58mn bpd in February but have since edged lower,” the IEA, adviser to 29 industrialised countries, said in the report.

Under an interim deal signed in November between Iran and six world powers that came into effect on January 20, known as the Joint Plan of Action (JPOA), Iran’s exports are supposed to be held to an average 1mn bpd through July 20.

Higher Iranian sales since late 2013 have led to concerns in Washington that a softening of sanctions has given Tehran’s economy a boost. US-based think tank Foundation for Defense of Democracies, reacting to the IEA figures, said exports may still exceed the permitted level.

“While April numbers are lower, future months will have to drop considerably to meet the cap imposed as part of the Joint Plan of Action,” said Mark Dubowitz of the FDD, which has pushed for tougher Iran sanctions.

“Iran’s oil buyers may position themselves over the next two months to be in a position to rapidly increase their exports if there is a final deal reached by July 20, or a renewal of the interim deal for a further six months, which may come on even more generous terms for Tehran than the current one.”

Still, officials in the Obama administration have said they expect Iran’s oil sales to fall in coming months and average 1mn bpd over the entire six-month period and Iran on April 14 said it was exporting around 1mn bpd.

In April, China, South Korea, Turkey and Syria increased imports of Iranian oil, although this was more than offset by reduced volumes to India and Japan, the IEA said, citing preliminary data.