NEKA, Iran, Jan. 9 (UPI) -- Iran is attempting to acquire a portion of the burgeoning Caspian oil trade by offering oil swaps to Russia, Azerbaijan and Kazakhstan.
Under the proposed arrangement the three Caspian riparian oil producers would ship their product to Iran's northern Caspian shore port of Neka, and receive an equivalent amount of crude from an Iranian port on the Persian Gulf.
The arrangement has a number of advantages for the former Soviet states, including bypassing the heavily congested Turkish Straits, as well as shaving thousands of miles off transiting around Africa for tankers larger than the Suezmax class, the largest ships able to transit the Suez Canal.
East Asia's increasing appetite for Caspian crude is making the swap arrangement increasingly attractive for Azerbaijan and Kazakhstan, which has the added advantage of bypassing the Russian government-controlled Transneft pipeline monopoly.
The Bush administration is strongly opposed to oil swaps via Iran, which it is attempting to isolate economically. Iran uses the oil swap produced in the north of the country, where the majority of the Iranian population is located.
Despite Washington's disapproval Iran's Deputy Oil Minister for Caspian Sea oil and gas affairs Asadollah Salehi-Foruz stated that last month oil swaps via Neka were increasing, with more than 80,000 barrels per day transiting the Iranian network, according to IranMania.
Salehi-Foruz added that despite the uncertain winter shipping condition of the Caspian, in January Teheran expects the amount of the oil swapped to northern Iran will increase to 100,000 barrels per day using Caspian 12,000 ton tankers. Neka has a carrying capacity of up to 375,000 barrels per day.
