With key buyers falling by the wayside as US sanctions on Iranian oil loom, Tehran has few options to keep hold of its remaining clients and keep its oil exports flowing. In a pragmatic – or desperate – move, it has resorted to offering buyers major discounts.

In Asia, Iran has slashed the price of its key grades Iran Light and Iran Heavy against comparable grades from its nearby rival Saudi Arabia. October prices for Iran Heavy have stayed at a $0.85/B discount to Saudi Medium...