Iran Offshore Crude Storage Dips by 4 Million Barrels

Iranian crude oil stored at sea has seen a significant decrease by as much as 4 million barrels, as demand from the east continues to increase.

This is in stark contrast to trade with the west, which, in light of tough sanctions means western countries shun Iranian crude, as it makes financing oil deals with the OPEC member is increasingly challenging.

"The Eastern buyers have to be taking more of it. You can't flood the European market with it because there are so many people who can't take it," said a trader with a European oil company.

According to Reuters, only large European oil companies remain major buyers of the Iranian crude oil. These include Royal Dutch Shell, Total and Eni.

"Right now, we see about 550,000 barrels per day of Iranian crude coming to Europe," a second European trader said. "October is slightly lower than September, which was lower than August."

The crude oil shortage is also due, in part, to other Asian refiners stock up on differentials for colder climates, during winter.

"I think with December sour crude premiums picking up ... refiners are turning to Iran," a Singapore-based trader for a Western oil company, according to Reuters.
The Islamic Republic was storing as much as 16 million barrels of crude oil on tankers offshore, down from 20 million last month, traders and shipping sources said.

"In October, two (very large crude carriers) VLCCs of Iranian crude have discharged from floating storage for the East. This is more than we usually see,
Iran, OPEC's second-biggest oil producer, exports roughly 2 million barrels of oil a day, mainly to Asia.

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