A worker at an Iranian oil facility (March 2023)

Iran's Unsold Oil Stockpile Stands At 50M Barrels Amid Supply Glut

Sunday, 06/04/2023

Unsold Iranian oil stored on tankers and in ports is 50 million barrels as the world faces a supply glut and OPEC+ decided to keep production cuts to support prices.

Kpler, a data and analytics firm, has issues figures showing that Iran currently has 19 million barrels of gas condensate and over 30 million barrels of unsold crude oil on vessels, the Persian Service of Radio Free Europe in Prague reported. 

Mehr state news agency quoted Oil Minister Javad Owji on Friday as claiming that since Ebrahim Raisi's administration took office, the process of selling 78 million barrels of gas condensate stocked on oil tankers has started and has now reached zero.

However, figures obtained from Kpler indicate that Iran’s stockpiled condensate on tankers was 44 million barrels by the end of 2021, but it decreased to 18 million last month and now it has reached 19 million.

Meanwhile, Iran’s stocked crude oil on tankers around the Persian Gulf region has reached 30.5 million barrels, down by 16 million in the same period.

Mehr also said that some of these tankers were stranded on the waters for over three years inflicting an annual cost of 400 to 500 million dollars on the country.

Saudi Arabia said Sunday it will make deep production cuts in July as part of a broader output-limiting OPEC+ deal as the group faces flagging oil prices and a looming supply glut.

Saudi Energy Minister Prince Abdulaziz said the cut of 1 million barrels per day (bpd) by Riyadh could be extended beyond July if needed. "This is a Saudi lollipop," he said.

OPEC+ production cuts have angered the United States and its European allies for adding to existing high global inflation.

Referring to the contract signed between Iran and Venezuela in October 2021 for the monthly export of two million barrels of gas condensate, Mehr estimated that 40% of Iran's unsold gas condensate reserves have been delivered to Venezuela. It is not clear if Caracas pays international prices for imports from Iran, but in the past, there have been reports of gold deliveries to Iran for fuel purchases.

However, figures by Kpler reveal that since October 2021, a total of nearly 28 million barrels of Iranian gas condensate have been delivered to Venezuela.

Kpler's figures also show that Iran has not had a new shipment of gas condensate to Venezuela in the past three months.

Iran's oil exports in recent months - mostly to China - have exceeded one million barrels according to some industry sources, but its financial condition deteriorates as it is not clear how much hard currency it earns.

OPEC+, which groups the Organization of the Petroleum Exporting Countries and allies led by Russia, reached a deal on output policy after seven hours of talks and decided to reduce overall production targets from 2024 by a further total of 1.4 million barrels per day.

However, many of these reductions will not be real as the group lowered the targets for Russia, Nigeria and Angola to bring them into line with their actual current production levels.

By contrast, the United Arab Emirates was allowed to raise output.

OPEC+ pumps around 40% of the world's crude, meaning its policy decisions can have a major impact on oil prices.

OPEC+ already has in place a cut of 2 million bpd agreed last year and amounting to 2 percent of global demand.

With reporting by Reuters

More News

The Truth is in Your Voice

Send your Videos and Photos to us