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Half of Iranian supertankers now used for oil storage

25 April 2012

According to Reuters, Iran has been forced to deploy more than half its fleet of supertankers to store oil at anchorage in the Gulf as buyers of its crude cut back because of sanctions. Quoting two Iran-based shipping sources, the news agency said 14 of National Iranian Tanker Company's (NITC) fleet of 25 very large crude carriers, each loaded with about 2 million barrels of oil, are now at anchor acting as floating storage.

Some 56% of Iran's supertanker fleet is now being used for oil storage
Some 56% of Iran's supertanker fleet is now being used for oil storage

A further five of Iran's nine Suezmax tankers, with capacity of one million barrels, are also parked offshore with oil aboard. That means that of Iran's 59-million-barrel fleet of VLCCs and Suezmax sized tankers, 33 million barrels of capacity are being used to store crude at sea in the Gulf, or 56 percent of the fleet.

The shipping data suggests Iran's difficulties in selling its oil are getting more acute. With more than half the NITC fleet at anchorage, Iran's capacity to export oil is severely curtailed. The Iranian shipping sources said that storage tanks on land at Kharg Island, with capacity of some 23 million barrels, are now full.

Europe's oil embargo and US and European financial sanctions prompted by Iran's nuclear program have seen Tehran's oil sales drop to most Western destinations and drawn promises from some Asian buyers that they will cut purchases.

China halved its Iranian crude imports in March compared to a year earlier and South Korea cut purchases by 40 percent, while Japan has also made steep cuts.

Reuters says that if it cannot find new buyers for its crude, Iran's only option other than floating storage would be to curtail oilfield production.

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