Iran still does not have access to Arab pipeline that serves Europe

Bloomberg/Fuel Fix:
Egypt and Gulf Arab crude producers have yet to let Saudi Arabia’s regional rival Iran resume oil shipments through a pipeline they operate to supply customers in Europe and the Mediterranean Sea region, more than a month after international sanctions against Iran were lifted.

Arab Petroleum Pipelines Co., which operates the link known as SuMed, is still reviewing terms of the agreement that removed sanctions on Iran in January, according to a company official. The operator is seeking to ensure Iran complies with sanctions regulations before resuming oil shipments halted since August 2012, said the official, who asked not to be identified, citing company policy.

Egyptian General Petroleum Corp. owns 50 percent of SuMed, which connects the Red Sea with the Mediterranean. State-run Saudi Arabian Oil Co., known as Aramco, owns 15 percent of the link; International Petroleum Investment Co. of the United Arab Emirates, 15 percent; three Kuwaiti companies, 15 percent; and Qatar Petroleum, 5 percent, according to SuMed’s official website.

Iran is seeking to rebuild its energy industry after shedding sanctions that choked off growth and foreign investment. Last month the country loaded its first cargoes destined for European buyers since the removal of sanctions. Political friction between regional powerhouses Iran and Saudi Arabia, backed by its Gulf Arab allies, has intensified their battle for oil market share.
The pipeline is the key to getting oil to Europe on the shortest route.  While some oil has been loaded for shipment, it will be difficult to get it through the canal without the pipeline to lighten the load.  Iran's proxy wars in Yemen, Lebanon, and Syria gives the Arab states little incentive to help them.


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