Putin ally Iran sees oil exports fall amid steeper competition from Russia for Asian buyers

• Iran's oil exports have been steadily declining, according to a report from Bloomberg.
• Tehran is seeing increased competition from Russia in the Asian market for oil.

Iran's oil exports are falling as of late, thanks in large part to increased competition from Russia for Asian buyers.

Exports have fallen to 775,000 barrels a day from a peak of 1 million, sources told Bloomberg. China is where the competition is heating up, and Iran is aggressively re-adjusting barrel prices to stay competitive with Russia, according to the report.

Western sanctions on Iran already forced it to sell oil at a discount while also disguising its cargoes, which typically go to China. But Russian competition is now causing Tehran to make even steeper markdowns.

Russia, for its part, is relying more heavily on Asia as Europe moves away from the Kremlin's crude in response to the invasion of Ukraine. Western sanctions have also added extra pressure to Moscow's oil exports, and China is showing an increased willingness to fill the void left by European customers.

Bloomberg added that Iran's daily production output is 2.8 million barrels per day. Iran is also hoping to increase output further if a revived 2015 nuclear deal allows Tehran to increase crude activity.

Iran has the capacity to pump 4 million barrels a day and hopes to boost it to 5.7 million, Oil Minister Javad Owji told Nikkei.