Japan's oil distributors plan to stop importing Iranian crude in October

Roman Schwartz
September 6, 2018

Following Seko's comments, a spokesman for JXTG Nippon Oil & Energy, Japan's largest refiner, on Tuesday declined to comment on its loadings and imports of Iranian oil after October.

Mohammed bin Hamad Al Rumhy, oil minister for Oman, remarked, "There is a danger that the demand will be impacted as well: people often focus on the supply side - what happens if Iran stops supplying - but what happens if China reduces its consumption?" The company, he said, is still carefully monitoring the progress of the bilateral talks between Japan and the US.

Yet for all the pushback and negotiations, an emerging pattern shows U.S. sanctions are succeeding in throttling Iran's sales to its customers even before the measures take effect in early November.

Rouhani said Iran has started moving its main export terminal in Kharg on the Persian Gulf to Jask in the Sea of Oman.

"US producers are resisting temptation and exercising capital discipline, Opec and Russian Federation have convinced market participants they are managing the supply of over half of global production, the U.S. is using sanctions more actively, and several key Opec producers are at risk of being failed states", Barclays said.

Oman is a principal supplier of oil to China, with the latter buying nearly 90 percent of its exports past year.

Iran has in the past repeatedly threatened to block the Strait of Hormuz - which is used by its Gulf rivals including Saudi Arabia - when faced with sanctions on its oil exports and possible military action by the US.

American Horror Story: Apocalypse trailer features familiar faces from Ryan Murphy anthology
Of course, now we (kind of) know what to make of those mysterious teasers, what with the satan babies and gas masks. Murphy said the upcoming season is 'unlike anything we've done, because there's a big hook to it'.

Also weighing on crude futures was a currency crisis in Turkey. Cargoes to South Korea plunged over 40 per cent in July, while Japanese firms have said September-loading shipments may be their last. With the U.S. not yet saying whether it's granting any nation an exemption, all shipments from Iran to its leading customers may be in peril starting this month.

Production by the Organization of the Petroleum Exporting Countries rose 220,000 barrels per day (bpd) in August to a 2018 high of 32.79 million bpd, a Reuters survey showed.

The price of Brent went up by about 60 cents to sell at $78.24 a barrel, while US crude went up by 15 cents to trade at $69.95. Front-month prices have soared nearly 50 per cent over the past year, and were at $79.17 a barrel at 11:01 am in London on Tuesday.

Meanwhile, NYMEX WTI prices were trading slightly higher during the Asian morning session ahead of the release of weekly U.S. crude inventory data, which will be delayed this week by the Labor Day holiday.

"If emerging markets get worse. that will impact crude markets", he said.

The government and lawmakers have shaken up the financial policy making circles in recent months with last week's sacking of the minister of economic affairs and finance, the latest official to lose his job.

Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER