The International Energy Agency (IEA) has reported that an increase in Iranian oil storage capacity will give Iran greater flexibility to export crude oil.
The US and the European Union have imposed sanctions on the Islamic Republic regarding its nuclear programme, stopping it from reaching production capacity.
Iran’s limited storage capacity has forced the country to keep crude on National Iranian Tanker Co (NITC)-controlled tankers at sea.
‘The expansion of land-based storage increases the flexibility of the Iranian supply chain, which could see floating storage volumes fall further over coming months,’ energy watchdog the IEA said in its monthly Oil Market Report.
The Iranian administration is now looking to commission ten more storage facilities by the end of next year. This will have a combined capacity of seven million barrels.
‘Although currently in the planning stage, the $2.5 billion project will reportedly include an extensive tank farm with a capacity of approximately 20 million barrels, while a 2,200 km pipeline will transport crude to the terminal,’ the IEA said.