Bloomberg News

Iran Halts Oil Exports to Pakistan as Sanctions Bite, Mehr Says

November 09, 2011

Nov. 9 (Bloomberg) -- Iran stopped exporting oil to neighboring Pakistan after a refiner in the South Asian nation failed to obtain financing for a purchase due to U.S. and European Union sanctions on Iran, Mehr news agency reported.

National Iranian Oil Co. signed a contract to sell 12,000 barrels of oil a day to state-owned Pakistan Oil Refining Co., state-run Mehr reported today, citing Pakistan’s Minister for Petroleum and Natural Resources Asim Hussain. Some banks in Pakistan rejected the Karachi-based refinery’s requests to open letters of credit in favor of the Iranian company, according to the report.

Iran, the second-largest OPEC producer after Saudi Arabia, was the sole supplier to the refiner, which has closed for unspecified “technical reasons,” Hussain said, according to Mehr. The date for the halt in exports, and whether any other Pakistani importers might be affected, was unclear.

The Persian Gulf country is under U.S., EU and United Nations sanctions because of its nuclear program. The restrictions make it difficult for many foreign companies to do business with Iran.

--Editors: Bruce Stanley, Rob Verdonck

To contact the reporter on this story: Shaji Mathew in Tehran at shajimathew@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net


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