FocusIran boosts domestic gasoline output; aroms exports to suffer

03 September 2010 05:46  [Source: ICIS news]

By Mahua Chakravarty

IranSINGAPORE (ICIS)--Iran may not have enough supply of aromatics to export this month given its need to boost domestic gasoline production amid the sanctions imposed on importing the fuel, industry sources said on Thursday.

The country is a net exporter of aromatics to Asia and the Middle East, but local refiners may have had to forego production of aromatics products such as benzene and toluene in order to use more reformate for gasoline blending, they said.

“Benzene and styrene monomer (SM) got loaded in August, but we are still waiting for news on September,” said a Middle East-based trader.

“Word is out that the shipments may be rescheduled ...[as] they have not told anyone that it was cancelled,” the trader added.

Iran was exporting about 420,000 tonnes/year of benzene to Europe and Asia, or at a rate of 35,000 tonnes/month, market sources said. The monthly export volume, however, had fallen to about 10,000 tonnes with the start-up of PARS Petrochemicals earlier this year.

Part of Iran’s benzene output from Borzouyeh and Bandar Imam Petrochemical Complex feeds PARS’ downstream styrene monomer (SM) plant in Assaluyeh, while volumes were being shipped to Kuwait and other Middle East-based SM producers under term supply agreements.

Any disruption of feedstock supply from Iran would then put the SM production of these plants at risk, with end-users likely to consider procuring spot supply from southeast Asia, traders said.

International sanctions were slapped on Iran to force it to stop its nuclear projects, with the US curbing its gasoline exports into Iran, leaving the country to fend for itself on its requirements for the automobile fuel.

Iran imports a third of its 63m litres/day gasoline requirement, given that domestic production was only pegged at 45m litres/day, according to a Reuters' report, citing data from the country's oil ministry.

State-owned National Petrochemical Company (NPC) had shut its two aromatics plants in Assaluyeh and Bandar Imam 10 days ago, along with their downstream downstream SM and paraxylene (PX) units.

Independent producer Esfahan Petrochemical, which sells toluene to India on a tender basis, was also expected to sell limited volumes, regional traders said.

“They [Esfahan] have also been told not to export, [as] toluene can be used as blendstock [for gasoline],” the Middle East-based trader said.

Iran’s inability to export aromatics, however, may help ease Asia’s glut in supply, market sources said.

“There has been impact for sure since the regular importers of toluene from Iran to India have not been very active in offering Iranian origin product and are looking towards Far East to source [the] material,” said an Indian trader.

Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections

For more on aromatics, visit ICIS chemical intelligence
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By: Mahua Chakravarty
+65 6780 4359

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