Iran hits back at EU sanctions by halting sales of crude oil
Source: Agencies |
February 20, 2012, Monday
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IRAN has stopped selling crude to British and French companies, the country's oil ministry said yesterday, in a retaliatory measure against fresh EU sanctions on the Islamic state's lifeblood - oil.
"Exporting crude to British and French companies has been stopped. We will sell our oil to new customers," ministry spokesman Alireza Nikzad said.
Last month, the European Union decided to stop importing crude from Iran from July 1 over its nuclear program, which the West says is aimed at building bombs. Iran denies this.
Iran's oil minister said on February 4 that it would cut oil exports to "some" European countries.
The European Commission said last week that the bloc would not be short of oil if Iran stopped crude exports, as they have enough in stock to meet their needs for about 120 days.
Last week, industry sources said Iran's top oil buyers in Europe were making substantial cuts in supply months in advance of European Union sanctions, reducing flows to the continent in March by more than a third - or over 300,000 barrels daily.
France's Total has already stopped buying Iran's crude, which is subject to fresh EU embargoes. Market sources said Royal Dutch Shell has scaled back sharply.
Among European nations, debt-ridden Greece is most exposed to Iranian oil disruption.
Motor Oil Hellas of Greece was thought to have cut out Iranian crude altogether and compatriot Hellenic Petroleum along with Spain's Cepsa and Repsol were curbing imports from Iran.
Iran was supplying more than 700,000 barrels per day (bpd) to the EU plus Turkey in 2011, industry sources said. By the start of this year imports had sunk to about 650,000 bpd as some customers cut back in anticipation of an EU ban.
Saudi Arabia says it is prepared to supply extra oil either by topping up existing contracts or by making rare spot market sales. Iran has criticized Riyadh for the offer.
Iran said the cut will have no impact on its crude sales, warning that any sanctions on its oil will raise international crude prices.
The EU's new sanctions includes extra restrictions that go well beyond UN sanctions agreed last month and include a ban on dealing with Iranian banks and insurance companies and steps to prevent investment in Tehran's oil and gas sector, including refining.
Iran has little refining capacity and imports about 40 percent of its gasoline for domestic use.
"Exporting crude to British and French companies has been stopped. We will sell our oil to new customers," ministry spokesman Alireza Nikzad said.
Last month, the European Union decided to stop importing crude from Iran from July 1 over its nuclear program, which the West says is aimed at building bombs. Iran denies this.
Iran's oil minister said on February 4 that it would cut oil exports to "some" European countries.
The European Commission said last week that the bloc would not be short of oil if Iran stopped crude exports, as they have enough in stock to meet their needs for about 120 days.
Last week, industry sources said Iran's top oil buyers in Europe were making substantial cuts in supply months in advance of European Union sanctions, reducing flows to the continent in March by more than a third - or over 300,000 barrels daily.
France's Total has already stopped buying Iran's crude, which is subject to fresh EU embargoes. Market sources said Royal Dutch Shell has scaled back sharply.
Among European nations, debt-ridden Greece is most exposed to Iranian oil disruption.
Motor Oil Hellas of Greece was thought to have cut out Iranian crude altogether and compatriot Hellenic Petroleum along with Spain's Cepsa and Repsol were curbing imports from Iran.
Iran was supplying more than 700,000 barrels per day (bpd) to the EU plus Turkey in 2011, industry sources said. By the start of this year imports had sunk to about 650,000 bpd as some customers cut back in anticipation of an EU ban.
Saudi Arabia says it is prepared to supply extra oil either by topping up existing contracts or by making rare spot market sales. Iran has criticized Riyadh for the offer.
Iran said the cut will have no impact on its crude sales, warning that any sanctions on its oil will raise international crude prices.
The EU's new sanctions includes extra restrictions that go well beyond UN sanctions agreed last month and include a ban on dealing with Iranian banks and insurance companies and steps to prevent investment in Tehran's oil and gas sector, including refining.
Iran has little refining capacity and imports about 40 percent of its gasoline for domestic use.
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