Japan, S.Korea plan to resume Iran oil imports from January -sources

Fuji Oil Co (Shinagawa)

19/11/2018 23:00

(Repeats item published earlier with no changes)
    * Refiners in talks with Iran to sign new contracts -sources
    * S. Korea's Iran oil imports to stay at zero until year-end
    * Japan buyers may pause in March pending insurance renewal

    By Osamu Tsukimori and Jane Chung
    TOKYO/SEOUL, Nov 19 (Reuters) - Refiners in Japan and South
Korea are looking to resume Iranian oil imports from January
after receiving waivers from U.S. sanctions on Tehran, sources
familiar with the matter said. 
    The unexpected resurgence in Iranian oil imports due to the
waivers has helped push spot prices for Middle East crude and
condensate to their lowest in more than a year.  urn:newsml:reuters.com:*:nL4N1XR2TZ
 urn:newsml:reuters.com:*:nL4N1XQ1RA 
    The United States in November granted exemptions to eight
countries, allowing them to import some Iranian crude for
another 180 days. Japan and South Korea were among the top five
buyers of Iranian crude and condensate before they stopped
imports in the third quarter ahead of the sanctions.
 urn:newsml:reuters.com:*:nL4N1XH2F3  urn:newsml:reuters.com:*:nL4N1XP22L 
    South Korean refiners are set to hold their Iranian oil
imports at zero until the end of the year, and they may resume
shipments in late January or early February as buyers are in
talks with Iran to sign new contracts, industry sources said. 
    "They are seeking to get the best price and are in talks
with Iran," said a source with direct knowledge of the matter. 
    Most tankers are booked until December, so South Korea may
load Iran oil shipments in January at the earliest, he said. 
    It takes about 25 days for oil shipments from Iran to arrive
at South Korea. Iran also has the option of selling oil from
storage in Dalian, China, which would shorten delivery time.
 urn:newsml:reuters.com:*:nL3N1WY44K 
    Last week, a South Korean delegation was in Iran to
negotiate for 2019 supplies of mainly South Pars condensate.
 urn:newsml:reuters.com:*:nL4N1XK2G1 
    "There are some issues to be cleared like payment. We are
not able to buy it at the moment and are not rushing," a second
source said. "Iran is also trying not to sell it cheaper. We ...
won't import Iran oil until perhaps after January." 
    The sources declined to be named due to the sensitivity of
the matter. 
    
    JAPAN 
    Fuji Oil Co  5017.T , one of Japan's top Iranian oil buyers,
plans to resume Iran crude liftings from January as well, and is
also looking to buy condensate.  urn:newsml:reuters.com:*:nL4N1XU209 
    Fuji Oil was considering whether to sign a new contract for
Iranian crude, its top executive said last week, adding that oil
from Iran is competitively priced against rival grades.
 urn:newsml:reuters.com:*:nL3N1SG2G6 
    Japan's largest refiner, JXTG Holdings  5020.T , said
earlier this month it may resume Iranian oil loadings from
December.  urn:newsml:reuters.com:*:nL4N1XI2V8 
    But while Japanese buyers are likely to buy Iranian oil
through February loadings, they may not take the crude from
March onwards, as they wait for the government to extend
sovereign ship insurance into the new financial year that starts
on April 1, industry sources familiar with the matter said. 
    Started in 2012 to counter sanctions on Iranian oil, Japan's
sovereign insurance scheme covers any shortfalls from Protection
& Indemnity (P&I) insurance for ships carrying crude from Iran
to Japan. 
    The Japanese government has declined to give information on
the volumes of Iranian imports that would be allowed under the
180-day exemption period. 
    Some sources said the sanctions waiver may allow Japan to
buy around 100,000 barrels per day (bpd) of Iranian oil. That
marks a significant reduction for buyers that took about 165,000
bpd of Iranian oil in January-September.  urn:newsml:reuters.com:*:nL3N1XA32U 
    Japan joined South Korea in temporarily halting Iranian oil
loading around mid-September. 

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
GRAPHIC: Asia's Iranian crude oil imports    http://tmsnrt.rs/2cNidjY
 
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Reporting by Osamu Tsukimori in TOKYO, Jane Chung in SEOUL and
Florence Tan in SINGAPORE; Writing by Florence Tan; Editing by
Tom Hogue)
 ((osamu.tsukimori@thomsonreuters.com, +813 6441 1857, Reuters
Messaging: osamu.tsukimori.thomsonreuters.com@reuters.net;))