(Refiles to fix typo in link to graphic)
* March cuts similar to Jan/Feb when imports more than
* Sinopec, NIOC likely to resume term talks this week in
* Two sides divided over credit terms, prices for 2012
* Iran oilmin to visit China, likely next week
By Chen Aizhu
BEIJING, Feb 6 China will halve its crude
oil imports from Iran in March compared to average monthly
purchases a year ago, as a dispute over payments and prices
stretches into a third month, oil industry sources involved in
the deals said on Monday.
China is the top buyer of Iranian oil, taking around 20
percent of total exports, but it has since January cut purchases
by around 285,000 barrels per day (bpd), or just over half of
the total daily amount it imported in 2011.
Negotiators from both nations, however, are expected to hold
talks as early as this week in Beijing to resolve the payments
dispute, the sources said, adding that the European Union
embargo on Iranian crude gave China an advantage in any talks.
Officials from Sinopec Corp, Asia's top refiner
that processes nearly 90 percent of China's Iranian oil
purchases, are expected to meet counterparts from the National
Iranian Oil Company (NIOC), the sources added. Term supply
contracts are usually agreed upon by January.
"For March loadings, it will be the same cuts as the
previous month," said one senior trading official.
A second industry official, whose firm processes Iranian
oil, said: "Our Iranian volumes disappeared for the whole of the
Last year, China imported 27.76 million tonnes, or about
555,000 bpd, of Iranian crude, a record amount and a 30 percent
increase on the previous year.
BUYER OF LAST RESORT?
Tensions between Iran and the West rose last month
when European Union leaders agreed to embargo Iranian oil by
July and to freeze the assets of Iran's central bank, joining
the United States in a new round of measures aimed at
discouraging Tehran's nuclear development programme.
Iran has warned that it could cut off oil exports to Europe
before July 1, and also threatened to close the vital Strait of
Hormuz shipping lane, a move Washington said it would not
The reduced volumes from Iran coincide with a drop in
Sudanese crude oil supplies due to a dispute over transport fees
between the north and the newly independent south, but industry
sources said Sinopec appeared to be unaffected as it had secured
Sinopec, through its trading arm Unipec, has already snapped
up additional cargoes from Saudi Arabia, Iraq, Russia, Australia
and West Africa. The refiner is likely to buy more crude from
the spot market to cover March requirements, traders said.
China is also set to boost Iraqi oil liftings by some 50
percent this year versus last.
Analysts said that well-supplied China is unlikely, then, to
become the main buyer of any surplus crude that Iran decides to
sell to ease the effect of sanctions, despite the strong
political and trade ties between the two nations.
Iranian oil minister Rostam Qasemi, however, is due to visit
China within the next 10 days to discuss a range of energy
issues, according to a report on the Iranian oil ministry's
website published on Saturday.
"Extra supplies from Saudi Arabia would be the most obvious
alternative (to Iranian crude), but China has also been buying
greater volumes of other grades like (Russia's) ESPO on the spot
market, and been prepared to pay higher premiums for them," said
a Singapore-based Western trader.
Iran is China's third-largest supplier, after Saudi Arabia
The 2011 supplies from Iran included China's first term deal
for about 75,000 bpd of Iranian South Pars condenstate, a very
light crude oil that Sinopec bought from NIOC to feed its
But the Chinese firm has dropped the condensate off its
loading programmes in the first quarter, sources said.
(Additional reporting by Judy Hua in Beijing, Peg Mackey in
London and Francis Kan in Singapore; editing by Miral Fahmy)