Fuel consumption at lowest level since March
Iran’s weekly consumption of gasoline fell to its lowest level since the beginning of the Iranian calendar year on 21 March, down 12 per cent to 391.3 million litres from 445.2 million litres a week earlier, according to data released by National Iranian Oil Products Distribution Company (NIOPDC).
The trend was followed in the capital, Tehran where total gasoline consumption was 89.2 million litres in the week ending 20 August, down 1.9 million litres on the previous week.
Facing US and UN sanctions on imports of refined oil products, Iran has been seeking to decrease demand for gasoline as well as increasing its refining capacity. Imports currently account for between 30-40 per cent of Iran’s gasoline demand, but so far Iran has shown little sign of strain after more than a year of steadily losing its suppliers, such as Russia’s Lukoil (MEED 15:4:10)
On 9 July, Lloyd’s of London declared it would not insure or reinsure petroleum shipments going into the country. This will make importing gasoline much more difficult. The Lloyd’s marine insurance market represents 15-20 per cent of the total marine insurance industry.
The government aims to become self-sufficient in gasoline within three years. The timeframe presents a challenge, but the International Energy Agency (IEA) forecast in its July oil market report that Iran will reduce its gasoline import bill by 75 per cent within the next five years. This will be made possible by expanding refining capacity and removing the remaining subsidies. Iran’s gasoline imports will shrink to 100,000 b/d in five years from 400,000 b/d in 2009, the IEA said.