Iranian Oil Exports Are Down 40% As Sanctions Take Hold
According to the IEA, International Energy Agency, Iranian oil exports are down nearly 40% since sanctions have been put into effect against Iran over its nuclear program.
Western nations such as the U.S. and Europe, as well as most of the Middle East believe Iran is covertly developing a nuclear weapons program secretly alongside its stated nuclear energy for electricity needs. Iran has strongly denied any such nuclear weapons program and said their program is only for peaceful energy needs.
Exports have fallen from 1.5 million barrels per day in April-May from 2.5 million at end 2011 as China, Turkey, India, South Korea and Japan sharply reduce oil imports from Iran despite Iran offering below market pricing for its oil.
The European Union will impose a full embargo on Iran's oil from July 1. The measure will also effectively cut off tanker insurance, a major problem for Asian buyers who traditionally account for the bulk of Iran's oil sales.
The IEA report came out days ahead of nuclear talks in Moscow between Iran and world powers - the United States, Britain, France, Germany, Russia and China.
OPEC will be meeting in Vienna soon as said it will discuss stepping up production to meet the loss of Iranian oil on the market. Saudi Arabia, a strong U.S. ally, have already been pumping above OPEC agreed limits at the request of the U.S. in an effort to keep global oil prices down.