* February Iran oil output same as January
* May keep supply steady for month or two, says analyst
* Iran seeks new oil customers
By Amena Bakr
DUBAI, Feb 23 Iran said on Thursday it has
maintained oil production levels despite sanctions, but oil
experts said they suspected Tehran was storing crude at sea
while looking for new customers to evade Western measures aimed
at slowing its nuclear programe.
Iran's OPEC governor said oil output in February was steady
at around 3.5 million barrels per day, the same as in January.
"The production for this month will be the same as the
previous, around 3.5 (million)," said Mohammad Ali Khatibi,
Iran's representative on the board of governors of the
Organization of the Petroleum Exporting Countries.
Oil analysts said the assessment looked accurate.
"We don't see decreasing Iranian volumes this month," said
one industry consultant who tracks Iran's oil output. "I think
the view that production is falling is simply based on
assumptions that the sanctions are already restricting export
volumes. Although it is having an impact on their operations, we
don't see a decrease in exports."
European buyers have cut back on purchases from Iran ahead
of an EU embargo on Iran's oil imports effective July 1. Some of
Iran's biggest customers in Asia including China have also
reduced purchases. .
The United States has tightened financial sanctions on
Tehran, making it increasingly tricky for buyers of Iranian
crude to process payments back to Tehran. The West is seeking to
slow Iran's progress towards what it fears is a nuclear weapons
Oil output from OPEC's No.2 producer is down 5 percent from
February 2010 when the Islamic Republic produced 3.7 million
bpd, according to Reuters data.
But supply over the past six months is stable, contrary to
expectations among some industry watchers that Iran would have
to slash production as customers chose to find alternative
supplies because of sanctions.
How long Tehran can keep pumping at full throttle is
"The (Khatibi) statement signals they are storing crude but
they cannot do this for very long. They could probably do it
this month and next but then if they are still not able to sell,
they will have to cut production," said David Wech from energy
consultancy JBC in Vienna.
JBC says Iran's output has fallen over the last two years by
more than 250,000 bpd, 6.6 percent, because of a lack of
investment and could decline 300,000 bpd this year and a further
200,000 bpd in 2013.
"It is not just fresh oil sanctions that are hurting. It is
also sanctions on equipment and investments that have been in
place for years, which are beginning to have a toll on their
maturing fields," said Wech.
Khatibi said Iran had no problem selling its oil.
"We still have customers, everything is normal," he said.
China, India and Japan, the top three buyers of Iranian
oil, together buy about 45 percent of Iran's crude exports and
are slicing purchases by about 10 percent.
Turkey, which buys nearly 40 percent of its crude oil from
Iran, has so far been a loyal customer and is likely to stick
with Iranian oil..
Selling all its oil is likely to get more difficult for
Citing industry estimates, the International Energy Agency
(IEA) said that up to 1 million bpd of Iran's 2.6 million bpd of
exports could be replaced by alternative supplies once EU
sanctions begin in July.
Traders expect Iran to seek to maintain exports through
discounts and barter.
"Iran will try hard but the Americans are watching very
carefully what goes where. There will be sporadic cargoes here
and there but it is impossible to dodge sanctions with very
large volumes," said a trader with a big European trading house.
The first sign that Iran is holding more oil than normal at
sea came on Thursday. Iranian supertanker The Delvar anchored
off Karimun Island, an Indonesian island in the Singapore
Strait, Reuters shipping data showed.
And data from broker ICAP shipping shows Iran is also now
storing crude oil on two very large crude carriers in long term
(additional reporting Dmitry Zhdannikov, Alex Lawler and
Jonathan Saul; Editing by Richard Mably)