November 13, 2012 / 9:00 AM / in 7 years

Iranian oil output, exports rebound - IEA

LONDON, Nov 13 (Reuters) - Iranian oil production rose in October after seven months of decline and exports rebounded strongly, the West’ energy agency said on Tuesday, adding that the latest round of EU sanctions would further damage the country’s finances.

The International Energy Agency, which advises industrialised nations on energy policies, said Iranian oil output rose by around 70,000 barrels per day to 2.7 million bpd in October. Iranian exports jumped to 1.3 million bpd from 1.0 million seen in the two previous months.

“China and South Korea appear to account for the lion’s share of the increase in Iranian imports,” the IEA said.

The jump in imports could have brought Iran an additional $900 million last month, according to Reuters calculations based on the price for its oil of $100 a barrel.

Iran’s finances have been drastically stretched since U.S. and EU sanctions more than halved its oil exports compared to last year, undermining its budget and leading to a spike in inflation and a sharp weakening of its currency.

The sanctions are part of a stand-off between the West and Iran over Islamic Republic’s nuclear programme. The European Union further broadened the sanctions against Iran’s energy and banking industries in October in a bid to bring Iran back to the negotiating table.

“With the bulk of Iranian crude now heading to Asia, however, the main impact of the new EU measures will likely be on the country’s financial sector,” the IEA said.

The IEA also cited estimates as showing Iranian crude oil held in floating storage nearly halved to 13 million barrels at the end of October from as high as 25-30 million in April as its state tanker company is increasingly using its own fleet to deliver crude to buyers unable to obtain shipping insurance.

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