Tehran has lost more than US$3 billion in revenue per month for Western sanctions
Declining oil exports, the lifeblood of the Iranian economy, will increase Tehran's struggle to contain spiraling inflation and mounting unemployment amid its standoff with the West over its nuclear program.Exports in July will be a maximum of 1.1 million barrels per day (bpd), said an industry source familiar with Iran's monthly shipping plans and who declined to be named due to the sensitivity of the matter.
Iranian exports have declined steadily from the 2.2 million bpd average in 2011, as its oil buyers cut imports to comply with US and European Union sanctions imposed due to concerns the country is attempting to build a nuclear bomb.
Iran says its nuclear activities are peaceful.
It was estimated to have shipped between 1.2 million and 1.3 million bpd in June, industry sources said last month.
But actual July exports could be even lower as top buyer China disputes freight costs with Iran's top tanker company, delaying the loading of cargoes set to flow east.
India, Iran's second-largest oil buyer, could also reduce July loadings as Iran struggles to find tankers of the size Indian refiners require.
Japan and South Korea, among Iran's top five buyers, have halted all Iranian imports this month due to complications with shipping insurance, also sanctioned by the EU.
Japan is expected to resume buying this year. It has been granted exemption from US sanctions last month after having already steeply reduced purchases.
If Iran exported 1.1 million bpd in July, it would mean the country's budget losing around $3.4 billion revenue this month compared with a year ago, when exports amounted to 2.2 million bpd and Brent oil prices stood at around $110 versus $100 today.
Iranian oil usually sells at a discount of several dollars to benchmark dated Brent.
(Reusters)
