A South Korean delegation including oil buyers is expected to head to Iran next week to discuss resuming Iranian oil imports after a three-month halt, three sources with knowledge of the matter said, Reuters reported.
South Korea is one of eight countries that received waivers from the United States to continue importing Iranian oil for 180 days. It can import up to 200,000 barrels per day (bpd) of Iranian oil, mostly condensate, the sources said, without invoking US economic sanctions reimposed on Iran on Nov. 5.
The East Asian country was the third-biggest buyer of Iranian oil and also the largest importer of its condensate before it stopped imports in September ahead of US sanctions.
South Korea’s condensate imports from Iran stood at 159,770 bpd in January-August, down about 49 percent from 311,885 bpd in the same period last year, according to Reuters calculations based on the Korea National Oil Corp (KNOC) data.
Condensate is an ultra-light oil processed at splitters, typically to produce naphtha for petrochemicals.
SK Incheon Petrochem, a petrochemical unit of SK Innovation ; Hyundai Chemical, a unit of Hyundai Oilbank ; and Hanwha Total Petrochemicals, a joint venture between Hanwha Corp and France’s Total , are regular buyers of Iranian condensate.
Each of the three imported between 1 million and 3 million barrels of South Pars condensate a month in the first half of the year, the KNOC data showed.
Trade in local currencies
South Korea will be paying for Iranian oil in Korean won to escrow accounts handled by the Industrial Bank of Korea (IBK) and Woori Bank, according to a South Korea’s Foreign Ministry statement released early this week.
Buyers are also likely to receive oil delivered by Iran using tankers owned by the National Iranian Oil Co.
Japan has also announced resumption of oil imports from Iran.
The country’s leading crude oil wholesaler JXTG Holdings Incorporation says it is preparing to resume imports from Iran after the US issued a waiver for Tokyo.
"We will decide from (the standpoint of) diversifying our suppliers and economic feasibility," said an official of the oil wholesaler as quoted by Reuters.
JXTG, which imported several percent of its annual crude oil supply from Iran, stopped doing so in October only weeks before the US restored sanctions against Iran.
On Monday, the administration of US President Donald Trump restored all Iran sanctions that had been lifted in 2015 after a nuclear deal was signed between the country and the five permanent members of the Security Council – the US, Britain, France, Russia and China – as well as Germany.
Later, Washington said it had granted 180-day waivers to eight countries, including China, India, South Korea, Italy, Greece, Taiwan and Turkey, from the oil import ban reimposed on Iran by President Donald Trump.
Japan is one of Iran’s largest oil importers. As of September, Iranian crude oil accounted for 5 percent of Japan’s crude oil intake, and, as the head of the Petroleum Association of Japan, Takashi Tsukioka, commented in September, Tokyo will try to maintain a good relationship with Tehran despite the sanctions, according to a report by Reuters.
Turkish Energy Minister Fatih Donmez also said on Friday that Turkey has been granted a waiver of around 25 percent on US oil sanctions against Iran, amounting to around three million tons of oil annually.
Speaking in an interview with broadcaster NTV, Donmez said oil refiner Tupras (TUPRS.IS) was looking at alternatives to avoid any market difficulties. He said the 25 percent figure was approximate and Ankara had not yet received an exact figure.
He also said Turkey still had a contract to buy natural gas from Iran for five to six years and added that Ankara would continue to buy gas from Tehran.