NIOC to offer 2m barrels of heavy crude at IRENEX in late May

May 24, 2019

TEHRAN- National Iranian Oil Company (NIOC) will offer two million barrels of heavy crude oil at the base price of $64.23 at the international ring of Iran Energy Exchange (IRENEX) on May 28, Shana reported.

As reported, like previous light crude offerings, the least amount of sales will be 35,000 barrels for this offering which is the second round in the new Iranian calendar year (started on March 21) and it is based on the energy ministry’s new guidelines.

NIOC sold 70,000 barrels of heavy crude oil at IRENEX for the first time on April 30. In the first round one million barrels of heavy crude was offered at a base price of $60.68.

Offering heavy crude at IRENEX came after NIOC offered light crude at this stock market in eight rounds.

Successful sales of heavy crude at Iran’s stock market happened while the U.S. is tightening pressure on the country’s oil industry as the Trump administration announced last month that it would end waivers on crude purchase granted to Iran's primary oil buyers in a bid to push Tehran oil sales to zero.

Since the U.S.’s withdrew from Iran’s nuclear pact in May 2018, vowing to drive Iran's oil exports down to zero, the Islamic Republic has been taking various measures to counter the U.S. actions and to keep its oil exports levels as high as possible.

One of the main strategies that Iran chose to execute to help its oil exports afloat has been trying new ways to diversify the mechanism of oil sales, one of which is offering oil at the country’s stock market.

Iranian Oil Minister Bijan Namdar Zanganeh has said that NIOC will offer crude oil at IRENEX every week.

The minister said that it may take some time for selling crude oil at IRENEX to be common and regular, but the oil ministry will offer the product at this market every week.

NIOC offered crude oil at IRENEX first on October 28, 2018, just few days before new U.S. sanctions on Iran’s petroleum sector took effect (November 4). In the first round, NIOC could sell some 280,000 barrels of crude oil at $74.85 per barrel. With the daily supply amount of one million barrels, the market wrapped up by selling eight 35,000-barrel-cargos of oil on the day.

Now, offering heavy crude oil at IRENEX can open a new chapter for the exports of Iranian oil as this type of crude is of high significance both technically and commercially, because it accounts for a huge amount of production in the refineries and many refineries throughout the world specially in the South Asian region are willing to use this type which has of course lower price compared to the light oil.

EF/MA

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