Emirates National Oil Company (ENOC) signed an annual contract with Qatar’s International Petroleum Marketing Company (Tasweeq) to buy 20,000 barrels per day of condensate, the Emirati company said, as it aims to cut imports from Iran of extra light oil.
Dubai government-owned ENOC was the biggest buyer of Iranian condensate in the Middle East in 2012, with average imports having risen by about 20 percent to over 130,000 bpd in the first half of last year.
But purchases have dropped in the second half as the company bowed to pressure from the U.S. officials who have for months been leaning on the company to stop buying from Iran and find alternative sources.
ENOC refines the condensate at Dubai’s 120,000 bpd Jebel Ali refinery to provide the city’s 2 million mainly expatriate, often wealthy, residents with cheap subsidised fuel at 1.72 dirhams, 47 cents, a litre.
U.S. and European sanctions have succeeded in cutting Iran’s crude exports by half this year, slashing oil revenues and piling pressure on Tehran to drop a nuclear programme that Washington and Brussels fear is designed to develop weapons.
“We are committed to identifying new sources of condensate for the optimal operations of our refinery,” Saeed Khoory, chief executive officer of ENOC said in a statement, adding that they were looking to diversify their suppliers.
“We are looking to strengthen the volume of spot cargoes from third party suppliers in the Gulf region and Far East to manage our import pipeline in line with governmental guidance.”
The company said it imported 20 percent less Iranian condensate in the second half of last year, from the first six months and that finding the alternative supplies has been an issue.
“One of the challenges in managing the crude imports was the availability of alternate grades in required volumes and prices,” it said.