Iran will not switch oil sale market from Europe to Asia

Nov 03, 2008 01:00 AM

Iran is maintaining diversity in its markets for oil sales and is not switching from Europe to Asia, a senior Iranian energy official said.
Iran said it had reduced sales of crude by 70,000 bpd to a European buyer, France's Total, in line with a decision by OPEC to cut output by 1.5 mm bpd. Iran's share of the OPEC cut is 199,000 bpd.

The two biggest buyers from Iran, which is the second biggest oil producer in the OPEC come from Asia -- Japan and China.
"The diversity of crude oil sale markets is being maintained as before. We do not, by any means, confirm Iran's oil destination markets have changed from Europe to the Far East," Ali Ashgar Arshi told.

Arshi is the head of the National Iranian Oil Company's international affairs department.
"To preserve oil income at the highest level, it is necessary to observe market diversity as sometimes crude oil is cheap in one market and expensive in another," he said. "That is why it is necessary that we maintain a presence in all markets in order to maintain a balance."

To honour OPEC cuts in the past, Iran has reduced sales to Europe, the destination for most of its spot crude sales. The bulk of Iranian oil sales are in term contracts, experts say.
"Regarding production and export of crude oil, it is done according to OPEC's decision and we have not had any violation in either production or sales. Currently, the sale of crude oil is carried out well at appropriate market prices," Arshi said.

He also accused the United States of trying to deter buyers, saying: "America is putting pressure on some countries with ties with Iran not to buy oil from us or to minimise sales from us."
Washington is trying to isolate the Islamic Republic for what it says is a bid to build nuclear weapons. Tehran denies this, insisting it wants to master nuclear technology to make electricity and save more of its oil and gas for export.

He also said Iran was not storing any crude in the Gulf.
"There is at the moment no stockpile of crude oil floating in the Persian Gulf," the report quoted Arshi as saying.
Industry experts said Iran had been storing oil at sea as global spring refinery work cut demand for Iran's crude. Iran reported selling crude from floating storage over the summer.

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