Record Six-Month Oil Exports from Iran

Iran is set to export 1.26 million barrels of crude oil per day this month, marking a record for the past six months. Reuters reported on Monday, citing an OPEC source, that Iranian oil customers, anticipating the lifting of sanctions early next year, have increased their purchases in December. This initial estimate, which is nearly a quarter more than two months ago, could raise concerns about oversupply in global markets. Iran and its trading partners are gradually preparing for a post-sanctions environment. Last week, the Russian representative to the International Atomic Energy Agency stated that he expects the Iran nuclear deal with world powers, reached in July, to be implemented in January, leading to the lifting of sanctions against Iran. The Business Monitor research institute reported, 'We assume that the inspections by the International Atomic Energy Agency regarding Iran have been successful and will pave the way for the lifting of sanctions in early 2016.' According to this report, this would allow Iran to increase its exports by up to 700,000 barrels per day by the end of 2016. Iran has repeatedly stated that it will boost its oil production by 500,000 barrels per day as soon as sanctions are lifted in early 2016. Last week, the country reduced the price of its light crude oil for January delivery to attract buyers. Global oil prices have dropped by more than half since June of last year, after OPEC did not reduce its production to eliminate competitors. China, the largest buyer of Iranian crude oil, is set to import 460,000 barrels per day from Iran in December. In November, China purchased 486,000 barrels per day from Iran, the highest level in three months. India will import 203,000 barrels per day in December, up from 139,000 barrels per day the previous month. Japan will also import 188,000 barrels per day in December, the highest amount since April, having bought 177,000 barrels in November. South Korea, another of Iran's four major Asian customers, did not buy crude oil from Iran in November, only importing 29,000 barrels of gas condensate, but will import 189,000 barrels of crude oil and condensate this month. In an unprecedented move, Egypt bought 33,000 barrels of crude oil from Iran in November.