* U.S. due to review Asia's waiver extensions on Iran
sanctions 3rd time
NEW DELHI/SEOUL, May 21 (Reuters) - India has slashed
Iranian oil imports by almost a fifth since December, the
sharpest cut among Asian buyers, in a move that should increase
its chances of winning a new U.S. waiver next month on sanctions
targeting oil trade with Iran.
Sanctions imposed by the United States and Europe to force a
halt to a controversial nuclear programme that Tehran says is
for peaceful purposes saw Iran's oil exports more than halve
last year, costing it $5 billion a month in lost revenue.
The sanctions have forced refiners in India, Iran's
second-largest oil buyer, to reduce imports because national
insurer the General Insurance Corp. of India has said that
cover and losses on processing the crude would not be payable by
Local insurers rely on reinsurers, who are mostly based in
Europe and the United States, to share the financial burden in
case of claims on equipment worth billions of dollars.
The United States in June will review the 180-day exceptions
granted to Asian importers that make continuous reductions in
oil purchases from Iran. Waivers allow Iranian imports without
the risk of being cut off from the U.S. financial system.
Refiners want to continue using the Iranian crude many of
their plants are configured to process, as changes will need
lengthy testing of new grades or cause an alteration in output.
"We are hopeful that India will get a waiver again because
of this forced cut in imports," said an Indian government
source, who was not authorised to talk to media.
Officials in Iran's top customer China, which cut its oil
imports by 3 percent from the previous waiver period, also
expect to have their country's waiver renewed. South Korea has
increased its Iranian imports and is sending a delegation to the
United States to discuss its continued exemption from sanctions.
Waivers on U.S. sanctions have been granted twice to China,
India, South Korea and other Asian buyers. Japan, another top
buyer, won its third exemption during an earlier review period.
A U.S. State Department spokesman said it was too early to
tell if Asian buyers would get waiver renewals next month.
Overall, December to April Iranian oil imports by China,
India and South Korea were nearly unchanged at 833,000 barrels
per day (bpd), compared with the previous six-month period,
according to customs and trade data and a loading programme
obtained by Reuters.
Daily Iranian oil imports by the three were down 15 percent
from the six-month period December to May a year ago.
The biggest winners in recent months filling the supply gap
left in some Asian countries by falling Iranian exports include
Iraq, Libya, and Central and South American exporters.
China imported an average 440,800 bpd of crude from Iran in
the December-April period, down from 455,000 bpd in the previous
six months. From a year ago, daily imports rose about 6 percent
as Iranian shipments in the first quarter of 2012 fell sharply
due to a contract dispute.
Beijing opposes the U.S. and European sanctions on Iran and
views them as unilateral moves made outside a United Nations
framework. Even so, last year China cut imports from Iran by 21
percent versus 2011 to 438,448 bpd.
For all of 2013, China may cut imports another 5-10 percent,
and it expects that to be enough to retain a waiver on U.S.
sanctions, said trade officials familiar with the import
strategy of state refiner Sinopec.
China's imports for April were 371,500 bpd. China largest
refiner Sinopec Corp processes nearly all the Iranian
crude imported into the country, which is shipped in by its
trading arm Unipec and state trader Zhuhai Zhenrong Corp.
India imported 224,532 bpd from Iran in the December to
April period, according to the data and information gathered by
Reuters, down from 270,380 bpd it bought in the previous six
months. Compared with a year ago, imports fell about 40 percent.
Its imports from Iran in April are expected to be about
123,000 bpd, according to the preliminary loading programme.
Indian insurers have said they will not cover refineries
processing Iranian crude because reinsurers in Europe and the
United States, who dominate the global insurance market, will
not honour claims on refineries, ports or other facilities
handling Iranian oil.
Two of Iran's Indian clients - Mangalore Refineries and
Petrochemicals Ltd and Hindustan Petroleum Corp
- have said they will not import oil from Iran as long
as they are unable to hedge their risk.
SOUTH KOREA, JAPAN
South Korea's imports of Iranian crude averaged 167,649 bpd
in the December to April period, up 45 percent from the prior
six months. The imports fell about 9 percent from a year ago.
The comparison to the previous six months was thrown off
because South Korea imported no Iranian oil in August and
September last year. Its imports in April are expected to be
about 190,000 bpd, according to the preliminary loading data. SK
Energy and Hyundai Oilbank process
Iranian oil in the country.
A South Korean delegation is expected to visit the United
States mid to late-May to discuss the exemption, a source with
direct knowledge of the matter said, declining to be identified
as he was not authorised to speak to the media.
South Korea may have to commit to cut Iranian imports by up
to 20 percent over the next six months, the source said, though
Seoul could take heart from the extension of the sanctions
waiver for Japan, another close U.S. ally, in March.
For the six-month period ended February, a month before
Japan secured its third waiver, Japan's imports from Iran rose
31 percent to 200,000 bpd compared with the previous six months.
But they fell a third from a year earlier. Japan had also
halted its imports of Iranian crude for one month in the second
half of 2012, skewing its data.
Japan probably imported about 179,000 bpd in April, and
Tokyo plans to cut purchases from Iran by about 15 percent this
year from a year earlier. JX Nippon Oil & Energy Corp
is Japan's top buyer of Iranian oil.
(Additional reporting by Meeyoung Cho in Seoul, Florence Tan in
Singapore, Osamu Tsukimori and Risa Maeda in Tokyo, Writing by
Manash Goswami; Editing by Tom Hogue, Simon Webb and Ed Davies)