Japan’s last imports of Iranian oil could be in October

The US is encouraging its allies, Japan included, to wind down shipments of Iranian crude. Above, an oil refinery in Kawasaki. (Reuters)
Updated 19 July 2018
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Japan’s last imports of Iranian oil could be in October

  • US President Donald Trump’s administration has demanded nations cut all their imports of Iranian oil from November
  • Japan’s largest banks had already said they would stop handling all Iran-related transactions to meet the November deadline

TOKYO: Japanese oil refiners will likely stop loading Iranian crude by mid-September with final shipments arriving in the first half of October, the head of the nation’s oil refiners association said on Thursday, as the US pressures countries to halt such imports.
US President Donald Trump’s administration has demanded nations cut all their imports of Iranian oil from November as it reimposes sanctions over Tehran’s nuclear program.
Although it has said that some allies who are particularly reliant on Iranian supplies may be granted waivers that would give them more time to wind down shipments.
“Japanese oil refiners have been making preparations for lifting plans on the assumption that US sanctions are to be applied,” the president of the Petroleum Association of Japan (PAJ), Takashi Tsukioka, said.
“Considering that payment is to be finished by end of October, it is important that the refiners would finish loading (Iranian oil) before mid-September.”
Tsukioka added that the industry is asking the Japanese government to push to maintain current levels of Iranian imports in talks with the United States. But a Japanese government source, who declined to be identified, said winning a waiver was seen as “difficult.”
PAJ had said last month that Japanese refiners would likely stop importing from Iran, but on Thursday gave more details on potential timings.
Many refiners in Japan, the world’s fourth-biggest oil importer, say they are resigned to completely halting imports from one of their historically important suppliers, unlike during a previous round of sanctions when they substantially reduced imports from the Middle Eastern country.
Three industry sources familiar with the matter said shipping companies had told refiners in Japan that they would stop carrying oil cargoes from Iran. The sources declined to be identified as they were not authorized to speak with media.
That would follow similar announcements by the world’s biggest shipping companies including A.P. Moller-Maersk of Denmark.
Unlike Japan, China and some countries in Europe have significantly raised purchases following the lifting of previous sanctions.
“It would be unreasonable for (Japanese refining) industry to be influenced similarly by such countries,” said Tsukioka, who also serves as chairman of Japan’s second-biggest refiner, Idemitsu Kosan.
Japan’s largest banks had already said they would stop handling all Iran-related transactions to meet the November deadline set by Trump, Reuters reported last week.
Japanese refiners are looking to secure alternative supplies from the Middle East and the US among others, industry sources have said.
Japan last year imported 172,216 barrels per day of Iranian crude, down 24.2 percent from a year earlier, with Iranian oil accounting for 5.3 percent of the nation’s total imports.


China’s car sales decline deepens, road ahead bumpy

Updated 11 min 3 sec ago
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China’s car sales decline deepens, road ahead bumpy

  • ‘Car sales in January continued to decline, and there was no sign of improvement’
  • China has been grappling with slowing economic growth as well as the fallout of trade frictions with the US
SHANGHAI: China’s automobile sales in January tumbled 15.8 percent from a year earlier, the country’s top auto industry association said on Monday, as the world’s largest auto market hits the skids with the slump in sales extending to the seventh month.
China’s Association of Automobile Manufacturers (CAAM) said in an emailed statement to Reuters that sales dropped to 2.37 million vehicles last month. This follows a 13 percent drop in December and a 14 percent fall in November.
“Car sales in January continued to decline, and there was no sign of improvement. We estimate that February wholesales will also drop sharply” said Xu Haidong, CAAM assistant secretary general.
“The reason for the sales drop is still the slowing overall economy, and consumption decline in small and medium-sized cities” Xu said.
China has been grappling with slowing economic growth as well as the fallout of trade frictions with the United States, forces which contributed to its auto market contracting for the first time in more than two decades last year.
Beijing is now trying to persuade consumers to loosen their purse strings and has pledged to provide subsidies to boost rural sales of some vehicles and purchases of new energy vehicles.
“Q1 sales were good last year, so this year the industry expects to have negative growth in the first quarter” Yale Zhang, head of consultancy AutoForesight, said, but he predicts sales to gradually pick up in the next three quarters.
Industry executives also say China’s car sales in January and February tend to be affected by the Lunar New Year holiday, as consumers hold off on their car purchasing decisions around the festival.
The holiday’s dates change annually but tend to occur in either month. It took place in the first week of February this year.
China’s sales of new energy vehicles, however, continued to buck the trend, totaling 95,700 in January, a year-on-year increase of 140 percent, CAAM said.