Iran's Strategic Weakness

Reported as National Iranian Oil hires vessel to ship gasoil from Singapore:

National Iranian Oil Co. hired a tanker to transport 80,000 metric tons of gasoil or diesel to the Middle East gulf from Singapore, a shipbroker said.

The state oil company's shipping unit National Iranian Tanker Co chartered Champion Pride, owned by Nippon Yusen for a voyage starting on 22 February for US$550,000, Odin Marine (Singapore) said in a report today. The company last month hired Silvaplana, owned by Lukiardopulo & Co, to deliver a similar cargo from Singapore.

Iran, the second-largest oil producer in the Middle East, imports products such as gasoline and diesel as it doesn't have adequate refining capacity to meet rising demand. Iran imports around 100,000 barrels a day of gasoline, Energy Security Analysis said in its six-monthly Asian oil product report.

A US-led push to isolate Iranian banks from the global financial system because of terrorist-related activities intensified since 2006, said the Wakefield, Massachusetts-based research firm in the report e-mailed to Bloomberg News.

Non-US banks including BNP Paribas and Credit Agricole stopped providing letters of credit, used to guarantee payment on overseas fuel purchases, to banks in the Islamic Republic, the report said. Indian refiner Reliance Industries and Swiss oil trader Vitol Group ceased 50,000 barrels a day to 70,000 barrels a day of gasoline sales to Iran, it said.

Iran has agreements to buy gasoline and diesel from the Kuwait-based Independent Petroleum Group and a Trafigura-linked company over the next six months, International Oil Daily said this week, citing unidentified traders.