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Iran Cuts Crude 'Selling Price' To Asia To 3-Year Low

Tyler Durden's picture




 

In what appears to be a bid to lure Asian buyers to lock in longer-term supplies, Reuters reports that Iran has cut its quarterly selling price (for its flagship 'light' crude) to its lowest (relative to Saudi) since Q4 2012. According to recent tanker loading data, Iran's oil sales in September are set to hit a six-month low, and this price reduction is just one of the steps taken by the OPEC producer to ramp up output and regain market share lost since U.S. and European sanctions aimed at its nuclear program cut its crude oil exports by more than half.

Iran has cut its relative prices notably over the past year...

Iran set its official selling price (OSP) for Iranian Light crude for October at a 25 cents a barrel premium to Oman/Dubai, down 35 cents from the month before, two sources with knowledge of the matter said on Thursday.

This puts Iranian Light OSP at a 15-cent premium to Saudi's Arab Light in the fourth quarter, the lowest quarterly price since the last three months of 2012, according to Reuters data.

As Reuters reports,

Asian buyers have called for lower prices amid a supply glut that has made it tougher for Iran to elbow its way to higher sales volumes despite optimism over the deal that eased some of the sanctions in exchange for curbs on Tehran's nuclear work.

 

An executive at a North Asian oil refiner said it is in talks with the National Iranian Oil Company for next year's term supply, but that Iran's crude prices have been uncompetitive.

 

...

 

Iran sets its OSPs every quarter at differentials to Saudi prices, following discussions with key customers.

 

In the fight for market share, Iran and fellow members of the Organization of the Petroleum Exporting Countries, including Kuwait and Iraq, have dangled carrots in the form of extended credit and free oil deliveries in addition to outright price cuts to increase their sales.

*  *  *

Time for another sit down in The White House with The Sauds...

 

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Thu, 09/10/2015 - 18:26 | 6533392 FreeNewEnergy
FreeNewEnergy's picture

Unequivocally, exceptionally doublegood.

Thu, 09/10/2015 - 19:20 | 6533586 Poundsand
Poundsand's picture

War even by proxy costs fiat.  Pretty soon the US will stop leaving all that 'discarded gear' for them top pick up and the $150b that Obama is releasing to them will only go so far.

They ran pretty low on land mine field sweepers (I mean 10 year old kids) back when they were battling with Saddam.  What irony that one Hussein helped lock up those funds, and another Hussein is getting ready to give it all back.

Thu, 09/10/2015 - 18:41 | 6533445 Son of Loki
Son of Loki's picture

One big difference between Iran and Saudi is Iranian people are used to going without already due to the sanctions. Saudis aren't.

Thu, 09/10/2015 - 18:58 | 6533510 U4 eee aaa
U4 eee aaa's picture

I'm sure they are more than prepared to do with less. Like a gold plated Porsche instead of a gold plated Rolls Royce

Thu, 09/10/2015 - 19:13 | 6533569 Sudden Debt
Sudden Debt's picture

We should do one of those old fashion TV marathons or some concerts with sting and stuff for those poor people!

Let's not forget they are the once who lowered the skyline of New York for all of us!

Thu, 09/10/2015 - 19:28 | 6533450 Yen Cross
Yen Cross's picture

     This article just reminded me, the season finale of Tyrant is on tonight.

  Breaking Bad, Middle Eastern Style.

Thu, 09/10/2015 - 19:14 | 6533574 Usura
Usura's picture

Saudi (and Bahrain) Spring bitches

Thu, 09/10/2015 - 19:45 | 6533676 Ms No
Ms No's picture

Russia claims (RT) they were asked  to join the oil cartel and they declined saying something to the effect that their unique climate made it problematic to control production on a whim. 

Thu, 09/10/2015 - 19:55 | 6533711 magnetosphere
magnetosphere's picture

lmao the oil collapse was supposed to be because iran was increasing production.  turns out they were decreasing production.  why did goldman sachs even bother to fake a sanctions deal with iran?

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