Iran holding almost 70 million barrels of oil/condensate at sea – Bloomberg/Gibson

London, (Quantum Commodity Intelligence) – Iran may be holding as much as 69 million barrels of crude oil and condensate at sea, according to a Bloomberg report referencing leading broker E.A. Gibson Shipbrokers Ltd.

However, the report said it is difficult to say exactly how big the floating stockpile really is because it's unclear how many ships are being used and how full they are, according to Richard Matthews, Gibson's head of research.

Such a large volume of oil and condensate is likely to have a significant impact on the market, as traders await the outcome of talks in Vienna that could see sanctions against Iranian oil, shipping and banking interests lifted.

But Gibson's Matthews says it could take some time to clear the Iranian overhang, running into months rather than weeks.

'It will just take a bit of time for all the channels to get sorted out, for the buyers to have confidence to return,' he said. 'You'll see the activity gradually increasing over a period of months.'

Iran has a fleet of 40 tankers storing, according to Gibson's estimates. Twenty nine are VLCCs   (very large crude carriers) of approximately 2 million barrels each while eleven are Suezmaxes, which hold around 1 million barrels.

Meanwhile, Citigroup, which has a similar vessel count, said Iran could have 65 million barrels floating and a further 54 million in on-land storage, according to Bloomberg.

'The timing and the size of a return of Iranian oil to the market is pivotal to projecting the trajectory of global oil inventories and crude oil prices,' Citigroup said in a note. 'The physical oil can be delivered to major export markets, including India and China, within 10-20 days.'