Talks on Returning to Iran Nuclear Deal Start
The prospects of Korea resuming oil imports from Iran are growing as talks resumed between and Iran and global powers on returning to the 2015 landmark deal on containing Iranian nuclear development.
The yield of Iranian condensate, which is mainly used for production of naphtha, is 80 percent at the highest, much higher than the yield of other crude oil, which is about 20 percent. Another advantage of Iranian crude oil is that it is cheaper than other products.
Due to these advantages, Iranian crude oil was widely used in Korea. It accounted for 13 percent of Korea’s total crude oil imports in 2017. However, under the Donald Trump administration, Korea had to suspend the importation of Iranian oil. The U.S. government imposed economic sanctions on Iran's oil industry, claiming that Iranian oil was a financial source for terrorist groups.
With the growing possibility of restoring the Joint Comprehensive Plan of Action (JCPOA), the Korean petrochemical industry is paying keen attention to whether they will be able to import Iranian oil again. In particular, Bloomberg reported that Iran could dramatically lower prices to attract Korean oil refiners again.
Industry insiders regard the resumption of importing Iranian oil as a fact. In particular, the U.S. Treasury Department's Office of Foreign Assets Control (OFAC) announced on June 10 (local time) that it removed three former Iranian oil industry officials and two companies from the U.S. sanctions list. Analysts say the easing of U.S. sanctions is a positive signal for restoring the nuclear deal between the United States and Iran.