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JXTG shifts oil suppliers from Iran to Saudis, others

Reuters

Gas flares are seen from an oil production platform at the Soroush oil fields in the Persian Gulf south of Tehran in July 2005.

ReutersTOKYO (Reuters) — JXTG Holdings, Japan’s biggest oil refinery operator, has secured crude oil supplies from other countries such as Saudi Arabia to replace Iranian oil shipments that have been crimped by U.S. sanctions, its president said Monday.

“We are not importing Iranian oil from May, but there is no major impact,” JXTG Holdings President Tsutomu Sugimori told an earnings news conference when asked about the impact of tighter U.S. sanctions on Iranian oil.

“We have already secured supplies to replace Iranian oil from countries such as Saudi Arabia,” he said.

Still, Japanese refiners will work with the Japanese government to find a way to import oil from Iran again, as having diversified sources is an important issue for resource-poor Japan, he said, without elaborating on how that would work.

Iranian oil accounted for about 4 percent to 5 percent of Japan’s total oil supplies before the U.S. sanctions kicked in, he said.

Japanese refiners are taking more oil from other Middle East suppliers after the United States ended all waivers from sanctions on Iran starting from this month.

The United States reimposed sanctions on Iran in November after pulling out of a 2015 nuclear accord between Tehran and six world powers last year, although it allowed Tehran’s biggest buyers to continue buying some crude oil via waivers for another six months.

The sanctions have more than halved Iranian oil exports to 1 million barrels per day or less, but Washington said in April all sanctions waivers for those importing Iranian oil would end at the beginning of May.

The oil and metals group also said it aimed to reinforce growth areas such as chemical products, power generation and electronic materials under a long-term vision through 2040.

“The vision is based on an assumption that [domestic] oil demand will halve by 2040,” Sugimori said.

In April, the Wall Street Journal reported that JXTG was exploring the sale of its majority-owned Caserones copper mine, which could gain the company about $1 billion.Speech

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