Iran insists on boosting oil sales to stay in nuclear pact

14 May, 2019
Source: Al Jazeera

Iran insists on exporting at least 1.5 million barrels per day (bpd) of oil, triple May's expected levels under US sanctions, as a condition for staying in an international nuclear deal, sources with knowledge of Iran-EU talks were quoted by Reuters news agency as saying.

The figure was communicated in recent meetings between Iranian and Western officials, including Iranian Foreign Affairs Minister Mohammad Javad Zarif, but has not been set down in writing, four European diplomatic sources said.

According to one EU official, the Iranians have not been specific, but they wanted to ensure production returned to pre-sanctions levels. Other sources said Iran's demand seemed to be in a general range of 1.5 million to two million bpd.

"Zarif said specifically that they want to sell two million barrels of oil [per day], basically the level Iran was exporting before Trump withdrew from the deal," said a source present at the New York meeting in which the minister made the statement.

"But I don't think it is a serious demand. It isn't possible and the Iranians know it isn't possible."
EU officials also estimate that Iran needs to sell 1.5 million bpd to keep its economy afloat. A drop below one million bpd could bring hardship and economic crisis.

"The real problem for Iran is oil exports, but that's a question the Iranians have to ask the Chinese and Indians," a senior European diplomat said.

"The survival of this accord is a universal obligation and not just a European one as the Iranians keeps claiming ... If we want to save the deal, the Chinese have to continue buying the oil."

While Beijing has criticised the US sanctions, companies are erring on the side of caution. China Petrochemical Corp (Sinopec Group) and China National Petroleum Corp (CNPC), the country's top state-owned refiners, have skipped Iranian oil purchases for loading in May.

Iran has said it will sell oil on a "grey market" to evade US sanctions, without giving details.

"They [Iranians] took a small step away from the deal. I think they would be satisfied with a small, reciprocal step from Europe," another source said. "The reciprocal step wouldn't be about oil. I don't think there is much to do on oil."

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