Asian buyers cut Iranian crude imports amid sanctions

PanARMENIAN.Net - Japanese trading houses will cut Iranian crude imports from April, industry sources said on Tuesday, April 10 in the latest sign that Western sanctions are curbing the flow of Tehran's oil to its biggest customers in Asia, Reuters reported.

Insurers are showing growing reluctance to cover tankers carrying Iranian oil and a senior official at a unit of Chinese refiner Sinopec Corp said it was increasingly wary of crude from Iran due to the supply threat posed by sanctions.

The United States and European Union have tightened sanctions on Iran's oil trade as they seek to reduce the flow of petrodollars and force Tehran to halt a nuclear program the West suspects is intended to produce weapons.

"Iranian crude currently is a rather sensitive subject," Sinopec Shanghai Petrochemicals Chief Financial Officer Ye Guohua told reporters at an earnings briefing. "This year we will continue to be cautious about Iranian crude imports."

China, India, Japan and South Korea are the four biggest buyers of Iranian crude in Asia, and all of them have cut imports. The sanctions are making it hard for refiners who want to continue importing to find shippers, insurers to underwrite trade and banks to clear payments.

Industry sources in Japan said that trading houses and refiners there would reduce Iranian crude imports by about 60,000 barrels per day (bpd) in April.

The reduction is the equivalent to about 18.5 percent of the 322,900 bpd that Japan imported in the first two months of the year, according to the latest government data available.

The cuts come even after the United States in March exempted Japan and 10 EU nations from sanctions due to take effect in July because they have significantly cut purchases of Iranian oil. Soon after receiving the exemption, Finance Minister Jun Azumi said Japan would continue to cut imports of Iranian oil.