Poland buys Iran oil as sour crude flows tighten

Platts— Iranian crude oil will soon be making its way to Poland as reduced flows of sour crudes into Europe are prompting some refiners to look outside of the region, shipping and trading sources said Tuesday.

PKN Orlen has bought a cargo of Iranian crude for November 24-25 loading dates, sources said. The Suezmax Delta Poseidon has been placed on subjects on a Kharg Island to Gdansk voyage at Worldscale 49, according to shipping fixture reports.

A source at PKN Orlen and Delta Tankers, which owns the tanker, were unavailable for comment.

Poland is heavily reliant on Russian Urals crude but the country’s two refiners are slowly beginning to diversify their crude supplies.

Russian exports from the Primorsk oil terminal, where the bulk of the Urals program usually loads, have been down sharply this month due to scheduled maintenance.

Sources said this along with reduced flows of Kurdish crude into Europe due to tensions between the Kurdistan Regional Government and Iraq, are increasing spot demand for sour crudes from the Middle East into Europe.

The last time Poland purchased Iranian crude was earlier this year, when the Vilamoura tanker discharged Iranian oil in mid-January.

In July 2016, Grupa Lotos bought spot cargoes of Iranian light crude from Iran’s National Iranian Oil Co. (NIOC).

In late October, PKN Orlen bought its first shipment of US crude, the first to Poland since the US ended its embargo on exports in December 2015.

The refiner has been diversifying its crude oil suppliers and last year it signed a contract with Saudi Aramco to receive 200,000 mt/month of crude to supply its refineries in Poland, Lithuania and the Czech Republic.

PKN also occasionally buys spot cargoes from Iraq, Azerbaijan, Kazakhstan, Nigeria and Norway.