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Saturday, May 18, 2013
South Korea's SK Energy lifted its first crude oil in Iran last week to end a nearly two-month gap in imports from the Middle Eastern country over a European Union ban on insurance cover for Iranian oil, a spokesman of parent SK Innovation said on Friday, 21 September.The move follows comments by Economy Ministry sources last month that South Korean refiners planned to resume from September monthly imports of up to 6 million barrels, or 200,000 barrels per day (bpd), of Iranian crude. The crude cargo of 2 million barrels is now heading to Seoul, said another source at South Korea's Economy Ministry who has direct knowledge of the matter but declined to be identified because of the sensitivity of the issue.The Ministry source said SK Energy, fully owned by SK Innovation, will lift another 2 million barrels in Iran later this month, while another refiner, Hyundai Oilbank, will also lift 2 million barrels in Iran this week or next."We lifted the Iranian crude oil cargo early last week, and it is scheduled to arrive at the end of this month or early next month," Yoo Jung-min, SK Innovation spokesman said. "The shipment is made via an Iranian tanker under Iranian insurance cover," he said, but declined to give details of the size of the cargo or subsequent crude lifting schedules.The resumption is unlikely to hinder South Korea's bid to extend a US sanction waiver in December as imports in 2012, which were down 17% in the first half, will still be almost 20% lower than last year.In June, South Korea became the first major Asian consumer of Iranian crude to announce it was halting imports after the government said shipments would be suspended from 1 July because of the European Union insurance ban.Tehran offered to provide up to US$1 billion of insurance cover to Iranian vessels shipping oil to South Korea as Iran has a major interest in keeping its crude flowing to its top four customers: South Korea, China, India and Japan. The four countries, which buy more than half of Iran's oil exports, have slashed Iranian purchases this year under pressure from EU and US sanctions aimed at squeezing Tehran's oil income to curb its nuclear program.The West suspects Iran wants to develop weapons. Tehran says its program is strictly for developing nuclear power.South Korea imported an unexpected 137,400 bpd of crude from Iran in July because of shipment delays in June cargoes, data from state-run Korea National Oil Corp showed last month. While South Korea will issue next week crude imports data for August, the economy ministry source noted on Friday that there was no import of crude from Iran last month.Of South Korea's four refiners, only SK Energy and Hyundai Oilbank import Iranian crude. SK Energy's term contracts with Iran this year provide for imports of two Very Large Crude Carriers (VLCCs) of crude per month, or 4 million barrels, and Hyundai Oilbank imports one VLCC per month, or 2 million barrels, according to the Economy Ministry source. – Reuters
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