Iran Cuts Crude Oil Stored in Tankers 40% Since April

(Bloomberg) -- Iran, the second-largest oil producer in the Middle East, released six supertankers from its fleet of vessels storing crude oil, a 40 percent reduction that may mean more oil heading to Europe, shipping tracking data show.

The National Iranian Tanker Co. has nine supertankers stationed off the United Arab Emirates and its own coast, according to data from the ships collected by AISLive Ltd. and compiled by Bloomberg. That’s down from 15 of the vessels on April 27. The six tankers that have been released can hold about 12 million barrels of oil.

European refiners, ending seasonal maintenance shutdowns, will increase production 2.5 percent in the third quarter to 12.4 million barrels a day, according to an International Energy Agency report on June 10. Output in North America and parts of Asia will decline in the same period, according to the report.

“Storage is the safety valve that blows from time to time,” Anders Karlsen, a shipping analyst at Nordea Securities in Oslo, said by phone today. “It makes an impact most certainly” on the tanker market, he said.

Incentive Fades

The reduction coincides with a trend among international oil companies to cut sea storage as the financial incentive to do so fades. The amount of crude held on tankers hired for long- term storage, excluding Iranian supplies, has fallen 60 percent this year to 17 million barrels as of July 2, according to ICAP Shipping International Ltd.

Out of Iran’s 28-strong fleet of vessels, eight are bound for Ain Sukhna, a facility at the Red Sea entrance of the Suez Canal that feeds a pipeline to storage tanks on Egypt’s Mediterranean coast, according to the AISLive data. From there, European refinery clients normally collect cargoes on smaller vessels.

Most Iranian oil unloaded at Ain Sukhna will likely end up in the European refining system, having been collected from the Sidi Kerir terminal by smaller ships, Per Mansson, managing director of Nor Ocean Stockholm AB, said by e-mail today.

The carriers Najm, Dadgar, Nabi, Hohar, Davar, Hengam, Hirmand, Marbat and Danesh have been in their present positions for at least two weeks, according to their signals. All nine vessels are sitting at 80 percent or more of their maximum depths in the water, indicating they have full or partial cargoes on board.