South Korea's February Iran oil imports soar ahead of shutdown
South Korea's crude imports from Iran surged 104 percent in February from a year earlier as refiners hiked purchases ahead of maintenance shutdown starting from March, according to the country's customs data and a refining source. South Korea imported 1.1 million tonnes of Iranian crude last month, or 294,069 barrels per day (bpd), up 4.5 times from January and double from a year earlier, preliminary customs data showed on Saturday.
Copyright Reuters, 2014
In the first two months of the year, South Korea imported 173,744 bpd, up 2.3 percent from a year ago, and a surge of 30 percent from the 134,000 bpd that Seoul took from Iran in 2013. Under the Geneva accord between Iran and six major powers last November that took effect in January, South Korea and other Asian buyers can hold to crude imports at the sanctions-reduced rates reached at the end of 2013.
"The two refiners had to hike the imports ahead of maintenance shutdown starting from March. Before and after the maintenance, refiners usually import more to meet annual import contracts," a Seoul-based refining source told Reuters. Of four South Korean refiners, SK Energy and Hyundai Oilbank are the only ones that buy Iranian oil on a regular basis. Their Iranian crude imports can vary from month to month as one of the two refiners that buy from the Opec receives the oil only every other month.
SK Energy will shut a 260,000 bpd No 5 crude distillation unit (CDU) and a 57,000-bpd No 1 gasoline-making unit in the second quarter for maintenance, a spokesman at parent SK Innovation Co Ltd said. Hyundai Oilbank will shut its No 1 110,000-bpd CDU in April for maintenance, it said last month. Iran's top four buyers - China, India, Japan and South Korea - have been steadily cutting purchases over the last two years to avoid falling foul of toughened US and EU sanctions put in place in 2012. Together they cut oil imports from Iran by 15 percent on the year to an average of 935,862 bpd in 2013, government and industry data showed.