Iran Faces Oil Glut Amid Sanctions as Storage Nears Capacity

Darwin, 25 April: Iran’s oil exports have come under strain due to U.S. sanctions, creating a bottleneck at its ports. Storage facilities at Kharg Island—the country’s main export hub—are nearing full capacity. To manage the situation, Iran has reactivated a 30-year-old massive crude carrier to use as floating storage.

Maritime analysts say the tanker, identified as M/T Nasha, had long been anchored idle. It is now being refurbished and deployed to store excess crude oil, according to Gulf News.

According to tanker tracking firm TankerTrackers.com, supply and demand are currently out of balance at Kharg Island. Analysts estimate that only about 13 million barrels of onshore storage capacity remain, while daily inflows stand at around 1 to 1.1 million barrels.

At this rate, storage could be completely filled within 12 to 13 days, with the situation likely becoming critical by the end of April.

Experts warn that once storage is full, Iran may be forced to reduce or halt production at its oil fields. Fields that rely on water injection to maintain pressure could be shut down quickly, as they require continuous operation once production begins.

Despite the ongoing conflict, Iran has continued loading oil shipments from Kharg Island. Recent reports indicate that tanker loading operations have persisted even after strikes by the United States and Israel.

Analysts note that while floating storage offers temporary relief, it is not a long-term solution. If sanctions persist and exports remain constrained, Iran may face difficult choices—either cutting production or risking damage to its oil fields.

As Iran’s most critical oil export terminal, any disruption at Kharg Island quickly impacts the national economy. By bringing M/T Nasha back into service, Iran appears to be buying time to manage the crisis.