(Updates with analyst comment from fifth paragraph.)
April 11 (Bloomberg) -- Iran’s crude shipments in February were the highest since the imposition of sanctions and more than a limit agreed with Western powers in an interim nuclear deal, according to the International Energy Agency.
The country shipped 1.65 million barrels a day to importing countries in February, the highest level since June 2012, the IEA said. March shipments, estimated to have fallen to 1.05 million barrels a day, “will likely be revised upwards closer to February levels upon receipt of more complete data,” the IEA said.
“Imports of Iranian oil are running well above 2013 levels for the third consecutive month” and could remain high in April, the Paris-based adviser to 28 nations said in its monthly oil market report. Under the interim nuclear deal agreed in November, “Iran’s exports are supposed to be held at an average 1 million barrels a day for the six months to end-July,” it said.
Iranian oil production plunged by a million barrels a day, or 28 percent, from 2011 to 2013 after the U.S. and European Union banned imports of oil from the country and imposed financial sanctions. An interim accord easing restrictions on insurance for Iran’s oil shipments and freeing up cash held outside the country went into effect in January, in return for a suspension of some parts of the country’s nuclear program.
Crude shipments from Iran will probably average above 1.2 million barrels a day over the six month period of sanctions relief, Richard Mallinson, geopolitical analyst at Energy Aspects, said by phone today from London.
Keeping production at the level of the last couple of months “will have a real knock-on effect in the diplomacy,” Mallinson said. “I don’t think it’s too late yet for Iran to moderate that short-term behavior, in order to rebuild some confidence in the talks and as they progress towards a final deal.”
Officials from Iran, the U.S., U.K., France, Germany, China, Russia and the EU met in Vienna this week. “A lot of intensive work will be needed to overcome the differences,” between the two sides before a final July deadline for a nuclear deal, EU foreign policy chief Catherine Ashton said as talks ended April 9. Diplomats will meet again on May 13 for talks.
The IEA revised upward February import volumes of Iranian crude by 240,000 barrels a day after it gathered more complete data. China, India, and South Korea all imported more Iranian oil than originally estimated in last month’s report, the IEA said. The agency counts cargoes once they are received in importing countries.
Buyers permitted to import Iranian crude under U.S. sanctions are Turkey, China, Japan, India, South Korea and Taiwan. In March importers of Iranian oil expanded to include Albania and Syria, the IEA said. February data for Chinese, Indian and Korean imports were revised upwards by 168,000, 93,000 and 83,000 barrels per day respectively. Japanese data was revised down by 103,000 barrels per day.
Iranian crude stored on tankers fell from 32 million barrels at the end of February to 22 million barrels at the end of March, the agency said citing data from E.A. Gibson Shipbrokers.