By SARAH KENT
LONDON -- Iran is building up its shipping fleet in a bid to maintain oil exports as its customers dwindle amid tight international sanctions against the country, the International Energy Agency said.
The Islamic republic has struggled to sell its crude oil as a result of sanctions imposed by the US, United Nations and the European Union, which accuse Tehran of developing a nuclear weapons capability under the guise of a civilian nuclear program.
"Expanding the shipping fleet should provide the state oil company more flexibility in marketing its crude and for use in floating storage," the IEA said.
Iran has added seven new Very Large Crude Carriers to its fleet since the beginning of the year, including four in the last four months, the agency said. National Iranian Tanker Co.'s fleet now numbers 37 VLCCs, with a total capacity of 64 million bbl, and 14 smaller tankers, with a capacity of 12.5 million bbl.
At the end of July, Iran's oil in floating storage stood at 30 million bbl, unchanged from June, it said.
Iran produced 2.65 million bpd of oil in July, compared with output of 3.5 million bpd in December 2011 before strict sanctions on oil exports were imposed.
While preliminary data show the country's oil exports rose to 1.16 million bpd in July from 960,000 bpd in June, Iran supplied oil to just five customers -- China, Japan, South Korea, Turkey and the United Arab Emirates, the IEA said.
Although India has imported on average 200,000 bpd from Iran this year, preliminary data for July show the country imported nothing last month as companies faced difficulty securing insurance for shipping and refining operations, the IEA said.
The election of moderate cleric Hassan Rowhani to the Iranian presidency in June could, however, bring about a thaw in relations with the West even as the US pushes for tougher sanctions. While campaigning, Mr. Rowhani promised to move to ease the sanctions, and he has since struck a conciliatory tone, calling for "serious" negotiations on Iran's nuclear program.
Dow Jones Newswires