Iran oil output at lowest since 1980s

The IEA said it was becoming difficult to determine where Iranian oil was being shipped as Iran’s national oil company shut off satellite tracking systems on its ships (Reuters/File Photo)
Updated 14 June 2019
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Iran oil output at lowest since 1980s

  • The US in November reimposed sanctions on exports of Iranian oil
  • President Donald Trump pulled out of a 2015 accord to curb Tehran’s nuclear program

LONDON/PARIS: Iran’s oil production has dropped to its lowest level since the 1980s as the full force of US sanctions weighed on exports, the International Energy Agency (IEA) said on Friday.
The US in November reimposed sanctions on exports of Iranian oil after President Donald Trump pulled out of a 2015 accord to curb Tehran’s nuclear program. Eight economies, including China and India, were granted waivers for six months — which expired at the beginning of May.
That has had a huge impact on Iran’s energy industry, with production plunging by 210,000 barrels per day (bpd) in May to 2.4 million bpd, its lowest levels since the Iran-Iraq war, the IEA said. Exports fell by 480,000 bpd to 810,000 bpd — less than a third of what it was exporting a year ago.
The IEA said sanctions have not yet completely cut off Iranian oil exports, but they have fallen drastically. It added that it was becoming difficult to determine where Iranian oil was being shipped as Iran’s national oil company shut off satellite tracking systems on its ships.
The news came as the Paris-based IEA, which coordinates the energy policies of industrial nations, revised down its global 2019 demand growth estimate by 100,000 barrels to 1.2 million bpd, but said it would climb to 1.4 million bpd for 2020.
“The main focus is on oil demand as economic sentiment weakens ... The consequences for oil demand are becoming apparent,” the IEA said in its monthly oil report. “The worsening trade outlook (is) a common theme across all regions.”

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480,0000

Decline of Iran’s oil exports in May, in barrels per day.

The oil demand growth forecast assumes the maintenance of US and Chinese tariffs imposed on goods in 2018, but the IEA said it had not factored in further US tariffs announced in May.
The IEA also attributed lackluster demand growth in the first half of the year to a slowdown in the petrochemicals industry in
Europe, warmer than average weather in the northern hemisphere and stalled US gasoline and diesel demand.
Demand growth was likely to pick up to 1.6 million bpd in the second half of the year on government measures to mitigate the economic slowdown and robust consumption in the non-developed world.
“Stimulus packages are likely to support growth in the short term. In addition, the major central banks have stopped or slowed interest rate increases, which should support growth in (the second half of 2019) and 2020,” the IEA said.
US sanctions on Iran and Venezuela, an output cut pact by the Organization of the Petroleum Exporting Countries (OPEC) plus its allies, fighting in Libya and attacks on tankers in the Gulf of Oman added only limited uncertainty to supply, the IEA said. Surging US supply as well as gains from Brazil, Canada and Norway would contribute to an increase in non-OPEC supply of 1.9 million bpd this year and 2.3 million bpd in 2020.
The IEA’s latest monthly report comes a day after attacks on two tankers in the Gulf of Oman, which caused oil prices to briefly shoot more than 4 percent higher, in the second spate of incidents in a month in the strategic shipping lane.
With some 20 percent of the world’s oil passing through the Strait of Hormuz, a disruption to shipping could roil markets.

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Unaoil’s former Iraq partner pleads guilty to bribery

Updated 19 July 2019
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Unaoil’s former Iraq partner pleads guilty to bribery

  • It is the first guilty plea to result from a three-year investigation by the Serious Fraud Office into suspected bribery and money laundering
  • Unaoil is a Monaco-based oil and gas firm

LONDON: The former partner in Iraq for Unaoil, a Monaco-based oil and gas consultancy, has pleaded guilty to five counts of bribery in the first conviction in a three-year criminal investigation by Britain’s Serious Fraud Office (SFO).
Basil Al Jarah, 70, pleaded guilty on July 15 to conspiring to give corrupt payments in connection with the award of contracts to supply and install single point moorings and oil pipelines in southern Iraq, the SFO said.
Al Jarah’s conviction, which comes six months before three other defendants in the case face a criminal trial in London, was announced after a judge lifted reporting restrictions in a pre-trial hearing on Friday, the SFO said.
Ziad Akle, Unaoil’s former territory manager for Iraq and Stephen Whiteley and Paul Bond, who worked for Dutch-based oil and gas services company SBM (Offshore), have pleaded not guilty.
Akle, 44, has been charged with three offenses of conspiracy to make corrupt payments. Bond, a 67-year-old former senior sales manager with SBM (Offshore), and Whiteley, a 64-year-old former vice president of SBM (Offshore) and one-time Unaoil general territories manager for Iraq, Kazakhstan and Angola, each face two counts.
Sam Healey, a lawyer at JMW Solicitors who is representing Whiteley, said his client “strenuously denied” all alleged offenses.
“Mr Whiteley co-operated fully with the SFO as they opened their enquiries and will rigorously defend the charges,” he said.
Lawyers for Al Jarah and Bond declined to comment. A lawyer for Akle was not immediately available for comment.
A spokeswoman for Unaoil declined to comment, while SBM Offshore has said it is company policy to not comment on past or current employees.