Prior to that, Japan did not import any Iranian crude oil from November 2018, for the first time since 2012. South Korea received its first post-sanctions cargo
Despite the existence of sanctions waivers, Japanese and South Korean refiners continued to face challenges in resuming Iranian crude imports due to problems getting shipping freight insurance. This reduced Iran’s oil exports from over 2 million barrels per day (
Prior to the granted waivers on the Iranian oil imports, Japanese banks suspended handling transactions for oil purchases, but the exemption from US sanctions allows banks to resume handling transactions temporarily during a 180-day period that will end in early May 2019.
As the waiver window closes, Japan and South Korea have just resumed Iranian oil imports in order to fill the void caused by an extremely tight oil market for medium and heavy crude grades.
So why did Japan just resume importing Iranian crude? Japan and South Korea are among eight countries with the US 180-day waivers, allowing them to keep importing Iranian oil through early May 2019.
Confusion surrounding shipping, insurance and banking transactions under the sanctions kept some of the countries from resuming imports for months after the US granted waivers on Nov. 5, 2018. Japanese refiners still need to obtain government approval before scheduling any loading from Iran.
Since the last quarter of 2018, Iran’s crude oil fleet started to switch off their satellite tracking systems on an increasing number of very large crude carriers (VLCCs) to avoid disguise shipments to customers that are not exempted.
Despite the US exemptions, Iran did not get all of its crude oil exports back, even as Tehran restricted access to export and production figures in a move aimed at keeping the outside world in the dark over the actual impact of US sanctions.
Japan’s total refining capacity stands at around 3 million barrels per day with an average utilization rate of 85 percent to 95 percent.
A few years ago, Japan was the world’s fourth-largest oil importer of around 3.52 million
During the last quarter of 2018, Japan shut about a fifth of its refining capacity due to a combination of scheduled and unexpected shutdowns.
The maintenance coincided with Iranian sanctions, and the granted waivers could not change the situation until those refineries completed their maintenance work. Now, once again they are in severe need of medium and heavy crude grades.
India is working on an alternative payment method for shipping in Iranian
S&P Global Platts reported that Iranian crude exports to India were robust before November 2018.
Around 500,000 to 600,000
But that dropped to 300,000-350,000
Even if India wins