An analyst with Kpler, a major international energy data and analytics group, Homayoun Falakshahi said in remarks published on Saturday that China “will become thirstier for Iranian oil” in the coming months mainly because of a potential drop in Russian supplies.
“Our estimate is that Russia’s domestic demand will increase over summer months and this can negatively impact this country’s exports, including to China,” Falakshahi noted.
The comments come as statements by Iranian Oil Ministry authorities and reports from international tanker-tracking services, including Kpler, have suggested that Iran’s oil exports reached an average of at least 1.6 million barrels per day (bpd) in May, a figure not seen since October 2018 when Iranian shipments dropped to record lows because of US sanctions, Press TV reported.
Private refiners in China buy a bulk of Iranian oil shipments with estimates suggesting that nearly 1.5 million bpd of Iran’s oil exports ends up in China.
Falakshahi said Saudi Arabia’s desire to deepen cuts to its oil exports, a policy meant to affect international oil prices, would also allow Iran to increase its supply of crude oil to Chinese buyers in the next few months.
That comes as Saudi Arabia’s oil supplies to China reached 1.75 million bpd in May and has remained at the same levels in June, he said.
Experts say the increase in Iranian oil exports in recent months have been a major sign that US sanctions on Iran’s petroleum sector have failed for good.