By Amir Bornaee, Market Analyst, EMEA Oil
In recent days, tankers chartered by several European companies such as Total, Litasco, and Cepsa were monitored loading crude at Kharg Island, a major Iranian loading port, according to Genscape. The vessels are bound for European destinations, marking the first crude shipments to take the route in four years.
Following the lifting of economic sanctions against Iran on January 16, 2016, several European oil companies have started negotiations to buy crude from the country.
On February 5, 2016, Genscape identified Distya Akula (IMO 9087972), a Suezmax chartered by Litasco, loaded about 1mn bbls and is thought to be heading to Constanta, Romania, according to several London tanker brokers’ chartering information. Genscape believes this to be the first Iranian oil shipment to an European country after the lifting of the sanctions.
Moreover, on February 14, 2016, Iranian officials announced that three tankers chartered for European destinations would load within the next 48 hours. Genscape monitored two cargoes bound for Europe that have since loaded at Kharg Island: VLCC Atlantas (IMO 9389899), chartered by Total, departed on February 15, 2016, with around 2mn bbls of crude and is now also heading to Northwest Europe via the Suez Canal, with a final destination yet to be declared. Monte Toledo (IMO 9271573), a Suezmax chartered by Cepsa, left Kharg Island on February 15, 2016, with around 1mn bbls of crude and has a declared destination of Algeciras, Spain. About 80 percent of Iranian exports are loaded at Kharg Island, according to Genscape.
More recently, Eurohope (IMO 9173745) loaded around 1mn bbls at Kharg Island on February 16, 2016, and declared Constanta as the initial destination upon departure. This would make the ship the second loading at Kharg Island bound for Constanta in less than a week.
Iranian officials welcomed a recent agreement between some OPEC members and Russia to keep a ceiling on oil output, but has not committed to limit the production. “We have repeatedly said that Iran will increase its crude output until reaching the pre-sanctions production level,” said Mahdi Asali, Iran’s OPEC representative, according to Sharq Daily.
Genscape expects to see more tankers loading Iranian crude for European destinations in the next few weeks and will continue to track the growth in Iranian output to help market participants assess the impact of changes in flow on regional markets. Genscape monitors Middle East Crude exports daily using its Genscape Vesseltracker data together with market intelligence sources to identify the loadport of each departing crude tanker and track it through to its final destination. Using Genscape Vesseltracker data, the Middle East Waterborne Crude Report, published on Wednesdays, illuminates the flows coming out of the Middle East producing countries so that traders and analysts can better gage markets in Asia, Europe, and the Americas. It provides traders and analysts with insight and analysis to better forecast short-term price shifts by enabling them to anticipate the arrival of crudes from the Middle East. This weekly report offers new transparency and helps market participants inform market positions, improve decision making, and gain insight on key market drivers.