The crude exports out of Iran fell further during the first few days of October showed tanker data, taking a big turn from sanctions placed by the U.S. and throwing up a big challenge for OPEC crude producers as they look to cover Iran’s shortfall.
Iran exported 1.1 million barrels a day of crude during the first seven days of October, showed data from Refinitiv Eikon. A source in the industry who tracks crude exports said shipments in October were below the 1 million barrels per day mark.
That figure is down from 2.5 million barrels daily in April prior to May when U.S. President Donald Trump withdrew the U.S. from a nuclear deal signed in 2015 with Iran and re-imposed sanctions on the Islamic Republic. The figure from early October marks a fall from September’s 1.6 million bpd.
Tanker schedules often are adjusted and exports will vary week to week. The early figures for October add to the signs that Iran exports are dropping at a quicker and steeper rate than originally expected, which pressures Saudi Arabia, Russia and other big producers to fill in the gap.
The tough stance by the U.S. government raised the stakes on the loss of exports from Iran than was foreseen previously said one analyst in Switzerland.
Oil prices continued their rally on the expectations that the sanctions would test OPEC countries as well as other large producers.
None of the crude exported from Iran during the first seven days of October is going to Europe as the tankers are headed toward China, India and the Middle East.
While the White House said it wanted to cut oil exports from Iran to zero, Saudi Arabia and Iran said that was not likely to happen. The White House is now considering waivers to sanctions for countries that are lowering imports.
One major buyer India has ordered oil from Iran for November though the India government said it did not know yet if it would receive a waiver.
Iran questioned if the market needed more oil and said its output was holding steady at 3.8 million barrels daily. The Islamic Republic has pledged to support any supply increase by OPEC.