TOKYO Asia's top buyers of Iranian oil cut imports by more than a quarter of a million barrels per day in the first five months of the year as they prepared for U.S. sanctions that take effect on Thursday and EU curbs that bite from Sunday.
Most of Iran's exports flow to Asia and Tehran acknowledged for the first time on Wednesday that its oil exports had fallen sharply, down as much as 30 percent from normal volumes of 2.2 million barrels daily.
The International Energy Agency estimates Tehran's exports have fallen even more, and pegs the reduction at 40 percent since the start of the year.
The latest import numbers from Iran's top four Asian buyers show purchases have fallen by 257,741 barrels per day, or 18 percent, in the first five months of this year.
Imports by Japan, China, India and South Korea from Iran fell 25 percent in May alone to 999,230 bpd from 1,338,193 bpd a year earlier, according to Thomson Reuters calculations from the Asian countries' customs data.
Year to date imports by the four countries fell to 1,192,881 bpd from 1,450,622 bpd. At today's prices that reduction amounts to a loss of around $24 million a day from Iran's oil earnings.
The sanctions are designed to restrict the flow of funds to Iran because Western governments believe the country is working on building nuclear weapons, although Tehran has maintained its nuclear program is strictly for civilian purposes.
S.KOREA TO HALT IMPORTS FROM JULY
South Korea this week became Iran's first major Asian customer to announce a halt in imports from July after the government failed to convince EU leaders to give it waivers on an insurance ban on tankers carrying Iranian oil.
The world's fourth biggest buyer of Iranian crude imported 192,211 bpd in the first five months of this year, down 16 percent from a year earlier, data from state-run Korean National Oil Corp showed on Monday.
Japan's crude imports from Iran fell by a third in the first five months of 2012 to an average 238,859 barrels per day, according to data from the country's Ministry of Finance, which released its figures for May on Thursday.
Both South Korea and Japan depend on the United States for their security but have no natural resources of their own, so they have scrambled to find other sources as they sought to reduce Iran imports.
Those efforts have been rewarded with waivers from the tough U.S. financial sanctions that start on Thursday.
But the EU ban has proven the most effective restrictions on Iran's oil exports yet as 90 percent of the world's shipping companies rely on European insurers to lay off the risks from personal injury and environmental clean-up claims.
Japan has been cutting purchases from Iran even though its demand for oil to fuel power plants has risen after all the country's nuclear stations were shut down in the wake of the Fukushima disaster last year.
Overall crude imports rose 7.1 percent to about 3.4 million barrels a day in May.
China, which hasn't received a waiver from U.S. restrictions, has cut Iran imports by 25 percent to 389,857 bpd so far this year, according to government data.
Still, both China and Japan plan to keep some oil flowing from Iran.
Japan's parliament last week approved an unprecedented law that allows Tokyo to provide cover of up to $7.6 billion for incidents involving tankers bringing Iranian oil to the country.
Unipec, the trading arm of China's top refiner Sinopec Corp (0386.HK), requested Iran to deliver July-loading crude cargoes to Chinese ports, sources said last week.
One source estimated Sinopec will lift about 500,000 bpd for July, a level similar to the average amount the top Asian refiner bought from Iran last year.
Japan has made nominations for about 120,000 bpd in June and July, sources said last week.
India, which has a waiver from U.S. restrictions, has allowed state refiners to import Iranian oil, with Tehran arranging shipping and insurance, from July 1.
India's imports of Iranian crude fell by 38 percent in May to 243,293 bpd.
They've risen 9.4 percent to an average 371,954 barrels per day since the beginning of the year, as Indian refiners drew higher volumes to meet their commitments under annual deals that ended on March 31, 2012 and build stocks.