Trade Arabia reported that the United States and Dubai are negotiating an end to the emirate's Iranian oil imports to head off the threat of Mr Obama president of US sanctioning a trade that has riled Gulf oil producers.

Industry sources and diplomats said that Washington in the summer tightened controls on financial transactions for importing Iranian condensate, a light hydrocarbon, as part of US efforts to starve Tehran of revenues for its disputed nuclear program. But Dubai is still buying the oil while US officials encourage the Dubai government owned Emirates National Oil Company to find another source of supply.

A UAE oil industry source said that the Americans did ask ENOC to stop importing but this is still going on.

A US official said that we have discretion under executive order and we are working with UAE to ensure imports wind down.

Iran's condensate sales are its biggest source of income after crude and refined products with Dubai its biggest buyer ahead of Asian buyers including China.

ENOC refines the condensate at Dubai's Jebel Ali refinery to provide the city's 2 million mainly expatriate, often wealthy, residents with cheap subsidized fuel at AED 1.72, 47 cents per liter.

US and European sanctions have succeeded in cutting Iran's crude exports by half this year slashing oil revenues and piling pressure on Tehran to drop a nuclear program that Washington and Brussels fear is designed to develop weapons.

According to estimates by some market analysts, but Dubai's condensate imports from Iran are up nearly 20 per cent from last year with ENOC continuing to bring in Iranian supply in barter deals, Gulf industry sources familiar with the matter said.

Source - Trade Arabia.com

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