“Neighbors, including Iraq, Afghanistan and Pakistan, had suspended imports due to the outbreak of coronavirus. They have reopened their border-crossings with Iran and exports have resumed,” Hamid Hosseini was quoted as saying by IRNA on Monday.
Referring to Iraq, which suspended imports of petroleum products from Iran in March, he said the Arab state has eased (coronavirus-related) quarantine for the fasting month of Ramadan (started April 25), due to which consumption of oil derivatives is expected to rise.
“Iraq’s Kurdistan region limited imports for three weeks. However, as soon as prices rose and demand increased, it resumed oil derivative imports from Iran.”
According to the official, in 2018 the value of Iran's oil derivatives exports to the Arab neighbor exceeded $9 billion. But outbreak of the infectious disease badly hurt bilateral trade.
Diesel, kerosene, jet fuel and liquefied natural gas, including LNG and LPG, are exported to Iraq, Pakistan, Afghanistan and Armenia via land borders.
Pointing to the value of exports, he said, "Close to $25 billion worth of petrochemicals, petroleum products, natural gas and power is sold to the four neighbors annually."
Giving a breakdown, he said of the total ($25b), $12 billion is from petrochemicals. Petroleum byproducts account for 33% ($8 billion) and the balance comes from electricity and natural gas exports.
All (energy and power) export prices are calculated on the basis of international crude oil prices.
Oil price futures for June fell to below zero last week for the first time in history as demand almost vanished. It improved later falling to the lowest since 1999.
The deadly Covid-19 has wiped out the travel and aviation industry as people in most countries stay away from travelling and using cars with lockdowns and close downs hammering economies as never before.
WTI June futures fell to $15.45 a barrel on Monday and Brent was sold at $21.00 a barrel.
“If the downward trend continues, Iran’s (energy and power) export revenues will decrease by at least 33% or $8 billion a year,” the PPEU spokesman said.
However, he noted that crude oil heavy fractions including bitumen are least affected by the sliding oil prices and that explains why gasoline is cheaper than bitumen now. He did elaborate.
Euro 4, 5 Diesel
In related news, Alireza Sadeqabadi, chief executive officer of the National Iranian Oil Refining and Distribution Company, was quoted as saying that diesel compliant with Euro-4 and Euro-5 standards has been sold nationwide since December 2018.
European emission standards define the acceptable limits for exhaust emissions of vehicles. Euro 4 and Euro 5 concentrate on cleaning up emissions from diesel cars, especially reducing particulate matter and nitrogen oxide.
Bandar Abbas Refinery in Hormozgan Province produces 14 million liters of diesel per day that is sold in the major port city and Chabahar in Sistan-Baluchestan, Bushehr and Kerman.
“Supplying quality diesel to the three main southern port cities, namely Bandar Abbas, Chabahar and Bushehr, is important as they are among major departure and destination points for many trucks and trailers.”
Daily diesel output from Tabriz Refinery, East Azarbaijan Province, is three million liters and available in East and West Azarbaijan, Ardebil and Kurdistan provinces.
Bandar Abbas, Tabriz, Arak, Tehran and Lavan refineries produce 42 million liters of Euro 4 and 5 diesel a day. The fuel is sold in Tehran, Markazi, Isfahan and Alborz, Zanjan and Yazd provinces. Total diesel output has reached 70 ml/d, up 17 ml/d compared to 2018.