Rystad Energy observes that the Iranian crude exports dropped materially for the second month in a row in Sep-18. At 1.7 million bpd for Sep-18, Iranian crude exports are 450,000 bpd below pre-sanctions (average between May 2017 and February 2018) levels of 2.15 million bpd. Rystad Energy sees increased likelihood of a larger cut in Iranian exports than our 900,000 bpd loss estimate as we await news about the US decision on sanction waivers for Japan, India, and others.

Iranian crude exports Thousand barrels per day

The US has moderated its goal of halting all exports of Iranian crude and now expects countries to cut imports by 1 million bpd. Refiners/countries can still apply for US sanction waivers subject to “significantly” reducing purchases of Iranian crude. Both France and South Korea have not taken a single cargo of Iranian crude since Jun-18, while Japan’s imports have dropped by 83% from pre-sanctions levels to only 22,000 bpd for Sep-18 and are expected to reach nearly zero in Oct-18. Both India and China imported less than their pre-sanctions levels in Aug-18 (Indian liftings dropped 50% m/m from elevated levels in Jul-18). Rystad Energy expects India to cut 50%, but sees risk of India “going to zero” (200,000 bpd downside risk) depending on Indian National Corp.’s ability to make payments in rupees.

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KeyFacts Energy Industry Directory: Rystad Energy