Iran looks to return to oil market 'stronger than ever'

By Syed Zafar Mehdi

TEHRAN (AA) - The political transition in Washington has raised hopes of the revival of Iran's fledgling oil industry hit hard by the US sanctions.

Iran's Oil Minister Bijan Zanganeh on Friday said the country will return to the global oil market "stronger than before" if the sanctions are eased by the new US administration.

Speaking on the sidelines of an international oil exhibition in Tehran, Zanganeh said the oil exports "sharply increased" in recent months despite the previous US administration trying to bring it to zero.

He further said the export of refined petrochemical products "hit the record high" over the past few years.

Iran's oil exports before May 2018, when the Trump administration reinstated sanctions on the country following withdrawal from the 2015 nuclear accord, were close to 3 million barrels per day (bpd), which plummeted below 500,000 bpd in the subsequent years, according to vessel-tracking websites.

Iran, which is OPEC's second-largest oil producer, has not released official data on the export of its oil and petrochemical products during the period of sanctions.

However, unofficial data shows the oil exports touched the lowest at 100,000 bpd in May 2020.

Most of the Iranian oil shipments are taken by foreign vessels via ship-to-ship transfers with transponders switched off to avoid detection, according to TankerTrackers data.

The data shows a substantial increase in oil exports since September last year, with Iran trying to bypass US sanctions to transfer oil to countries in the region like China by changing documents of vessels to maintain the secrecy of the source country.

US Treasury Department in June last year had sanctioned over a hundred Iranian oil tankers and ships, including two tankers that delivered gasoline to Venezuela. It also warned countries against buying oil or products from Iran and North Korea.

With oil exports hit hard by sanctions, Iranian authorities have in recent years turned the focus toward non-oil products, mainly supplying them to regional countries.

However, with the Joe Biden administration taking charge in Washington, there is hope that Iran might regain its oil market, paving the way for over 2 million bpd crude exports again.

More than 80% of the country's oil production comes from the southern region. Iran's state-owned National Iranian Oil Company has entered into agreements with many local contractors to further develop these oil-rich fields.