Iran opens talks with Japanese firms to resume oil sales under US sanctions waiver

LONDON/DUBAI: Iran has started discussions with Japanese companies on possible crude oil sales under a temporary US sanctions waiver, though prospective buyers are seeking a longer waiver and assurances over tanker safety, according to Iranian and Western sources cited by Reuters.

The waiver was issued on June 22 as part of 60-day talks between Tehran and Washington and is due to expire on August 21.

Two Iranian sources said three Japanese buyers were assessing possible purchases of Iranian crude, which would mark Japan’s first such imports since 2019.

A Western industry source familiar with the matter also said Japanese and Iranian officials were holding initial discussions on possible oil sales.

An official at Japan’s Ministry of Economy, Trade and Industry (METI), which oversees fuel supply infrastructure, said he was not aware of the matter. Japan’s foreign ministry and the U.S. Treasury did not immediately respond to Reuters requests for comment.

Japan, South Korea, India and European countries stopped buying Iranian oil after US sanctions were tightened following President Donald Trump’s withdrawal from the Iran nuclear deal in 2018. China has remained Iran’s main buyer in recent years.

A separate METI official said in June that any Japanese purchase would be a decision for private companies, but added that it was unclear whether such deals could proceed because of shipping timelines and existing contracts.

A senior Iranian official said any agreement would require the US to extend the current waiver, given the shipping time between Iran and Japan. The official said cargoes would be loaded at Iran’s Kharg Island and transported using Japanese-operated tankers.

A senior Iranian oil ministry official said the National Iranian Oil Company (NIOC) had approached traditional customers, including Japan, to indicate that Iran would want them to resume purchases if a peace deal was finalised and sanctions were lifted.

Iran’s oil ministry did not respond to a request for comment.

Shipping risks remain a major concern. The Strait of Hormuz has not fully returned to normal, and the operating arrangements for the waterway after any lasting agreement between Tehran and Washington remain unclear.

A container ship was attacked in the Strait of Hormuz last week by Iranian forces, while Iran’s Revolutionary Guards have said all transits through the strait must first be cleared with them.

The U.N.’s shipping agency estimates that around 80 floating mines are present in the central part of the waterway.

A senior official at a major Japanese oil refiner said securing insurance would be the biggest challenge for any shipment.

Trade sources and analysts have said the current short-term US waiver is unlikely to attract large orders from well-stocked Asian refiners, leaving independent Chinese refineries as the main buyers for now.