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Japanese Refineries Put Halt on Imports of Iranian Oil as Waiver Nears End

Japan has increased imports from the Middle East, Russia and the Americas as its Iranian imports fell, according to government data

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FILE - JX Nippon Oil & Energy Corp's refinery is pictured in Yokohama, Japan, Feb. 7, 2017. VOA

Japanese refineries have put a halt on imports of Iranian oil after buying 15.3 million barrels between January and March ahead of the end of a temporary waiver on U.S. sanctions, according to industry sources and data on Refinitiv Eikon.

The waiver, which allowed Japan to buy some Iranian oil for another 180 days, expires in early May. However, Japanese refiners want to ensure enough time for all cargoes already loaded to arrive in Japan and for payments to be completed.

“We think it would be difficult to keep on lifting Iranian oil after March,” a Fuji Oil spokesman said, noting that banks and insurance companies want to make sure all the transactions and deliveries are done well before the waivers expire.

Last oil arrives early in April

The last Iranian oil cargo on supertanker Kisogawa is expected to arrive at Chiba, Japan, April 9, the data showed. The United States last year demanded that nations cut all Iranian oil imports when it reimposed sanctions on the country’s petroleum sector Nov. 4 over Tehran’s nuclear program. However, Washington granted temporary exemptions to Iran’s biggest oil clients: Japan, China, India, South Korea, Taiwan, Italy, Greece and Turkey.

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FILE – An Iranian Revolutionary Guard speedboat passes near an oil tanker, July 2, 2012. VOA

Refiners in Japan, the world’s fourth-biggest oil consumer, had stopped loading Iranian oil by mid-September, and only resumed loading in late January after banks received government assurances about processing payments to Iran.

Japan has loaded 15.3 million barrels of Iranian crude in the first three months of this year, which is equivalent to 86,430 barrels per day (bpd) during the six-month waiver period, according to Refinitiv data and Reuters calculations.

This represents a 33 percent drop from an average of 129,300 bpd that Japanese companies lifted between January and September last year before the sanctions kicked in, Refinitiv data showed.

The drop was more than the 20 percent reduction in supplies that Washington was said to have sought from each country over the six-month waiver period.

More oil from US, Russia Mideast

Japan has increased imports from the Middle East, Russia and the Americas as its Iranian imports fell, according to government data.

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Japan has increased imports from the Middle East, Russia and the Americas as its Iranian imports fell, according to government data. Pixabay

Japanese refiners have been pushing the government to seek an extension of the U.S. sanctions waivers after the initial exemption period expires.

Japanese officials and their U.S. counterparts met earlier this month in Washington to discuss the U.S. sanctions.

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“I think the waiver could be extended, but maybe for a smaller volume and for a smaller number of countries,” said Takayuki Nogami, chief economist at Japan Oil, Gas and Metals National Corp.

“If the U.S. government does not extend the waiver, it could push crude oil prices up significantly as the gasoline season approaches and it could hurt Trump’s reputation,” he said. On Wednesday, Japan extended state-backed insurance to cover imports of oil from Iran for another year. (VOA)

Next Story

India stands to gain from historic Iran deal

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Washington: India, which has drastically reduced its oil imports from Iran under US pressure, stands to gain from the historic accord reached between Tehran and six world powers to limit its nuclear program in return for lifting sanctions.

But before India, which imports 70 percent of its oil supply, turns back on the taps of Iranian oil, President Barack Obama has to sell the deal to a hostile Republican Congress that has 60 days to review it.

Obama has vowed to veto any legislation that may scuttle what he described as “a comprehensive, long-term deal that will verifiably prevent Iran from obtaining a nuclear weapon”.

Asserting that “it would be irresponsible to walk away from this deal”, Obama said he would “welcome a robust debate in Congress on the details of this deal” even as he warned that “I will veto any legislation that prevents the successful implementation of this deal.”

“Because of this deal, Iran will not be able to produce highly enriched uranium or weapons-grade plutonium, the raw materials necessary to build a bomb,” Obama said in an open letter to the American public explaining “what this deal means and how it works”.

Under this deal, Iran will reduce its stockpile of enriched uranium by 98 percent, remove two-thirds of its installed centrifuges — the machines necessary to produce highly enriched uranium – and store them under constant international supervision, he said.

“Under this deal, Iran will modify its nuclear reactor in Arak so it cannot produce weapons-grade plutonium — and all spent fuel from the reactor will be shipped out of the country indefinitely,” Obama said.

Asserting that “This deal is not built on trust – it’s built on verification”, he said international nuclear inspectors will have access to Iran’s nuclear program – “where necessary, when necessary”.

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Image Source: www.newindianexpress.com

“As Iran implements this deal, it will receive gradual relief from sanctions. If it violates any aspect of this deal, sanctions that have crippled Iran’s economy will snap back into place,” he said.

According to the White House, the sanctions would begin lifting once the UN Security Council endorses the Joint Comprehensive Plan of Action (JCPOA) as the agreement is called, “simultaneously with the IAEA-verified implementation of agreed nuclear-related measures by Iran”.

So it’s still some more time before Iranian oil starts flowing freely again to India, which has reduced its oil imports from Tehran to 10-11 million tonnes in 2014-15 from 21.20 million tonnes in 2009-10. (IANS)