1/20/2016, 10:10 AM (Source: TeleTrader)
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Japan eyes deals in Iran after sanctions

Japan is expected to abolish economic sanctions against Iran by January 22. The country will restore exploration of the Azadegan oilfield near the Iraqi border, with about 5.2 billion barrels of recoverable oil,Nikkei reported. This would result in increasing Japan’s energy security and reduce dependence on Saudi Arabia and the United Arab Emirates, which are the Japanese largest suppliers of hydrocarbons.

Last week the Iranian parliament ratified the nuclear agreement that Tehran signed in July with the P5+1 group of six major world powers, and the sanctions related to the issue were officially abolished on Saturday. Iran has the fourth-largest reserves of crude oil in the world, but its exports decreased dramatically due to sanctions imposed by the United States in 2006 over concerns the government in Tehran was developing nuclear weapons under the guise of a civilian programme.

Japanese oil production company Inpex had to pull out from Iran in 2010, due to warnings from the United States it can be sanctioned if it violates an embargo on Iran. Now, when the agreement is reached, Japan will help its companies retake stakes in oil as soon as possible. Japanese business will once again be allowed to make new investments in the Azadegan oilfield. Japan’s exports to Iran were valued at $170 million in 2013. Japanese automakers and other companies are considering resuming exports to the country. The two countries are in discussions to sign an investment agreement until February.

WTI for delivery in January fell 3.06% to $28.54 a barrel and Brent declined 2.99% to $27.87 a barrel, both at 9:57 a.m. CET.

Breaking the News / ZR