ESSAR Oil sharply boosted oil imports from Iran in January and the privatelyowned refiner will need to rein in sharply in the next two months to be on track to keep its promise to ship 15 percent below contract volumes from the sanctions-hit country in 2012/13, tanker data made available to Reuters shows.
Essar, currently Iran’s only non-government Indian customer, imported 108,400 barrels per day (bpd) of oil from Iran in January, compared with 40,100 bpd in December. In the first 10 months of the contract year that started April 1, 2012, Essar boosted imports about 1.2 percent, while state-run refiners have cut purchases in the same period.
Overall, the world’s fourth-biggest oil buyer imported about 22 percent less oil from Iran in the first 10 months of the contract year, the data showed, helping it to secure waivers from US sanctions aimed at curbing Tehran’s nuclear ambitions.
In December, the United States granted 180-day waivers on Iran sanctions to China, India and a number of other countries in exchange for cuts in purchases of oil from the Islamic Republic.
The United States and the European Union have imposed sanctions to block Tehran’s oil revenue over its disputed nuclear ambitions, which they suspect is aimed at building weapons. Iran denies this claim.
Essar has a term deal with Iran to buy 5 million tonnes or about 100,000 bpd in the year ending March 31, 2013, but company sources said the refiner plans to cut imports by 15 percent after a directive from the government.
In the first 10 months of this contract year it has already imported about 83 percent of its term deal volumes.
Like other Indian refiners, Essar maximised purchases from Iran in the first half of 2012 ahead of tightening sanctions and to honour its 2011/12 annual deal.
Essar has significantly raised processing of heavy and ultra-heavy grades, including those from Latin America, to improve refining margins.
Essar aims to buy 15-20 percent of its crude oil needs from the domestic market, 35-40 percent from Latin American sources, and 30- 40 percent from the Middle East, it said in May.
In January, it imported about 51 percent of its crude oil needs from Latin American nations and turned to Brazil after a gap of four months, the data showed. It also shipped in a parcel of Canadian Cold Lake heavy oil for the first time in January.
No comment was available from Essar.