Iran in rare fuel barter deals with traders
Iran is reported to have started rare barter deals with major commodity traders through which it provides gasoline in exchange for high-quality fuel oil.
Reuters has reported that a scheme to the same effect is already underway with Vitol and Glencore ever since the sanctions against Iran were lifted in mid-January.
It said both traders have won the right to lift a combined total of at least 200,000 tons per month of Iranian fuel oil from March through May.
The agency further emphasized that the barter deals, which it said Iranian industry sources have acknowledged also included some done by Russian companies, have helped to wipe out the short-term fuel oil available for export, added the official.
"There is no extra fuel oil available in the short term, because they are all committed," Reuters quoted an unnamed Iranian official as saying.
Another Iranian industry official estimated Iran usually exports 700,000-800,000 tons of fuel oil a month during the spring months starting from late March, when warmer weather begins to curtail the fuel oil used for generating power during winter months, the agency added.
It further quoted traders as saying that the bulk of Iran’s fuel oil thus bartered will taken to Fujairah, a storage and bunkering hub in neighboring United Arab Emirates, where it will be fed into the local bunker market or blended with other grades to be redistributed to markets across Africa or Asia.
The report further emphasized that Vitol and Glencore both have operations at Fujairah, allowing them to use less expensive smaller vessels to deliver gasoline to Iran or to load fuel oil from there.
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