'Large volumes' of Iranian Bunkers Diverted to Singapore

'Large volumes' of Iranian bunkers have been diverted to Singapore.

Iran has diverted 'large volumes' of bunker product intended for Fujairah to Singapore to avoid international sanctions, according to Abu Dhabi Media's The National today.

It said traders had told them disguising the origin of shipping fuel in Singapore is easier than in Fujairah because of the huge volumes in storage there.

But Abolfazl Rostami, a senior trader at the National Iranian Oil Company (NIOC), had said that it was simply that "Singapore was proving a better market for Iranian exports".

Yesterday, Ship & Bunker reported that, effective July 1, 2012 a European Union ban on the transportation of Iranian crude oil and products will result in the loss of protection and indemnity (P&I) cover for any ship running on bunker fuel of Iranian origin.

The National quoted a Fujairah based broker as saying, "Getting product from Iran is impossible. Its been like this for more than two months."

The article said the drop in supply has caused prices in Fujairah to rise sharply.

Ship & Bunker data shows the price for key grade IFO380 down half a dollar today after 6 consecutive days of gains and a 2 week gain of $9.

Despite the rising prices, the 4 week trend remains down for all products.

Sanctions against Tehran have targeted the payment system for Iranian oil, and have made it difficult to insure cargos heading out of the Islamic Republic.

The National estimated that, to date, it has resulted in crude exports being reduced by 300,000 barrels per day (bpd), causing exports to drop below the 2 million bpd mark.

It also said Mr Rostami had denied that sales volumes had dropped.

"We are facing some problems for the sale of our product, but it has not stopped. Last year we had ten to twelve customers, this year we have five or six," he was quoted as saying.