Iran scrambles for new petrol

NEW YORK, March 12 (UPI) -- Iran is pressured into the secondary market for petroleum but it still has the ability to act domestically and find business partners elsewhere, analysts said.

Royal Dutch Shell, Swiss oil trading giant Vitol, BP and Reliance of India have emerged in recent days to say they would stop dealing with Iran, presumably from U.S. pressure over Iran's controversial nuclear activity.

Cliff Kupchan, an Iran expert at the New York consulting company Eurasia Group, said the decision forces Iran's hand, the Emirati newspaper The National reports.

"The decision by European companies and Reliance to stop supplying Iran with (petroleum products) will force Iran into secondary and less-efficient markets in order to obtain petroleum, which will increase Iran's transaction costs," he said.

Iran sits on huge oil and gas reserves but oil subsidies and crumbling infrastructure forces it to import roughly 30 percent of its fuel needs.

The U.S. Energy Information Agency said Iran in 2009 imported at least 120,000 barrels of petrol per day from China, Malaysia, Kuwait, Russia, France, the Netherlands and Switzerland.

Iran, meanwhile, has moved swiftly to make upgrades to its refineries and last week announced plans to slow consumption by reducing fuel subsidies.

Kupchan added that Iran would likely find business with its partners in the United Arab Emirates and China.