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Iran looks to Asian customers to fill oil gap

Iran looks to Asian customers to fill oil gap
As the time of talks over Iran’s nuclear program nears, the stakes are growing. The Islamic republic seems to be going at out to woo its oil customers in Asia, while severing economic co-operation with Europe.

­Tehran is offering advantageous credit terms to Asian customers, according to Financial Times. A number of nations including India were offered 180 days free credit which accounts to a discount of about $1.2 to $1.5 per $118 barrel per month. Iran’s move comes before crucial negotiations between Tehran and the Western over Iran’s nuclear program.

Iran has extended a pay back period for importers such as China to 60 and 90 days, after Iran’s main rival Saudi Arabia and other leading Middle East countries introduced 30 days of credit.

Currently Iran, which used to be the OPEC second oil producer, is struggling to boost its oil exports after being hit by EU sanctions against the country’s nuclear program. The sanctions come into force in July and will put an embargo on Iranian oil export and freeze the assets of its Central Bank.

The European Union, as well as Turkey, Japan, South Korea and China have already significantly cut imports. While in February, the country’s oil production has fallen by 50,000 barrel a day to 3.38 million barrel a day, a 10-year low according to the IEA.

In response, the Islamic Republic stopped oil sales to Greece, Spain and Germany. It halted supplies to Britain and France earlier this year.

On Wednesday Tehran also banned imports from 100 European companies in order to counter the EU sanctions, according to Iranian Press TV. The banned items include “luxury items”, says Sasan Khodaei, Deputy President of the Iran Trade Promotion Organization.