Azernews.Az

By Sara Rajabova

Legal proceedings between Turkey and Iran over gas prices continue, and Iran is likely to reduce the price of gas exported to Turkey, The Lira newspaper quoted Turkish Energy Minister Taner Yildiz as saying on Monday.

Yildiz said that Iran has offered a certain discount in the gas price, but it did not suit Turkey, and Ankara is now seeking to secure a price that it has itself defined.

Yildiz also expressed confidence that if Iran does not agree to a considerable reduction in the price, the International Court of Arbitration will resolve the case in favor of Turkey.

He also said Turkey plans to suspend the contract signed with Iran under the "take or pay" principle in 2013.

In 1996, Iran and Turkey signed an agreement to supply 10 billion cubic meters of gas to Turkey annually (30 million cubic meters per day).

According to the Turkish state pipeline company Botas, Turkey imported 39.7 billion cubic meters of gas from Iran in 2011.

India, an importer of Iranian oil, after reducing its crude supplies from Iran this year, has now said it will maintain the current shipments of oil from the west Asian nation, Presstv.ir reported.

India, which faces a huge deficit in its energy production and whose power sector is struggling to pay for fuel imports as the economy tries to maintain annual growth of 6.5 percent, is seeking all possible sources of energy supplies to achieve efficiency and meet domestic demand.

Crude imports from Iran are estimated at around 15-15.5 million tons for the current year.

About 70 percent of India's oil demand is met by imports, with Iran being one of the biggest suppliers. The government in New Delhi has therefore reacted with caution to the European Union's imposition of a new punitive package that embargoes Iran's natural gas (earlier sanctions targeted Iranian oil) and aims to plug loopholes that enabled Iran to circumvent Western sanctions and raise funds for its disputed nuclear program, Asia Times reported last Thursday.

Iran, which was India's second biggest oil supplier till 2011, has now taken fourth place in terms of crude supplies with 155 billion barrels of recoverable oil reserves after Saudi Arabia, Iraq and Kuwait, due to the US sanctions on the oil-rich nation.

According to analysts, for a country like India energy security is critical for the economy as the energy demand is increasing tremendously with growing population.

Defying the unilateral sanctions against Tehran, India recently approved insurance coverage for ships carrying crude supplies from Iran.

Experts say India needs Iranian oil to meet its growing energy demands, but at the same time they say the sanctions on the Iranian energy sector will hurt the world economy to a great extent.

Besides, South Korea is also set to resume Iranian oil imports in October after crude cargoes were halted by EU sanctions in the previous two months, with shipments transported under Iranian insurance cover to avoid sanctions targeting Tehran's nuclear program, Reuters reported on Monday.

The north-east Asian country's overall crude oil imports fell 2.8 percent in September from a year ago to 78.36 million barrels, or 2.6 million barrels per day (bpd), data from the state-run Korea National Oil Corp (KNOC) showed on Monday.

The world's fifth largest importer of crude oil and one of Iran's biggest oil customers imported 38.77 million barrels of crude oil from Iran in the first nine months of this year, down 41.3 percent year on year, KNOC said.

South Korean refiners have resumed imports of Iranian crude oil for October arrivals, with imports seen at about 6 million barrels per month, or 200,000 bpd, representing a return to full contracted volume.

Iran's exports have fallen sharply in the wake of the sanctions as consumers struggle both to pay for the oil and to secure insurance cover for tankers to ship the crude.

The head of the International Energy Agency (IEA) said on Monday that Iranian oil supply could fall more if sanctions continued, but other sources were filling the gap.

South Korea's crude oil imports from Iran this year are still expected to drop by just over a third from last year due to the two-month gap, said a government source who declined to be named as he was not authorized to speak to the media.

South Korea stopped importing Iranian crude from July 1 due to the EU ban, which is part of a raft of Western sanctions aimed at cutting Iran's oil revenues and squeezing funding to its disputed nuclear program.

On the other hand, Iran's oil and gas reserves have been increased in the region due to conducting four-dimension seismic monitoring in the Persian Gulf, Mehr news agency quoted Iranian Offshore Oil Company's managing director Mahmoud Zirakchianzadeh as saying.

The operations have been carried out at the Abouzar oilfield and Forouz-B gas field in the Persian Gulf, he said.

Iranian Oil Minister Rostam Qasemi has said that it is projected that the country's oil output will increase by 1.5 million barrels per day (bpd) by 2016.

Iran's oil production stood at 3.742 million bpd in the first quarter of 2012, which was an increase of 133,000 bpd in comparison to the output in the fourth quarter of 2011.

Iran has also attached priority to boosting gas production capacity at its joint oilfields with Qatar and Saudi Arabia.

The Iranian share of South Pars gas field, which is shared by Iran and Qatar, has about 14 trillion cubic meters of gas, or about eight per cent of total world reserves and more than 18 billion barrels of liquefied natural gas.

Daily gas production in Iran is about 600 million cubic meters and the figure is projected to increase to 1.2 billion cubic meters in the future. According to the National Iranian Gas Company, the country's oil and natural gas reserves account for 10 per cent and 16 per cent of the total world reserves, respectively.

With 34 trillion cubic meters of natural gas reserves, Iran has the world's second largest natural gas reserves after Russia.