Iran's top four oil clients slightly reduced imports from the sanction-hit nation in July and purchases remain down about a fifth for the year, as the United States keeps pressuring buyers to take less and less of the crude.

Asia may start to feel pinched, however, from the already deep cuts in the Iranian imports as the supply outlook for some of the alternative grades worsens. Asian refiners need to ramp up runs to meet peak winter demand and further cuts in shipments from Iran could increase input costs.

Crude premiums in Asia are already at multi-month highs, slashing the profit from processing a barrel of crude into fuels nearly two-thirds from a month earlier. Buyers are also on edge, worried a strike against Syria could disrupt supplies from key Middle Eastern exporters and boost prices even higher.

Oil shipments from Iran have more than halved from pre-sanction levels as the U.S. and EU sanctions have made it difficult to insure tankers carrying the crude. The measures have also forced refiners to find new ways to pay Tehran, because it is cut off from international banking networks.

Iran's clients have had to switch to other suppliers such as nearby Iraq and the United Arab Emirates.

"It's also an opportunity for Saudi Arabia to push back its output to 10 million bpd as they've always shown that they are willing to step up production," said Alex Yap, FGE analyst in Singapore.

China and other major Asian buyers of Iranian crude have to continue curbing purchases to win waivers to U.S. sanctions aimed at ending the country's disputed nuclear programme.

The U.S. House of Representatives in July easily passed a bill that is the first to spell out exactly how much Iran's oil exports should be cut, setting a goal of reducing the shipments by another 1 million bpd to near zero.

The bill has to be approved by the U.S. Senate and signed by President Barack Obama before becoming law.

In July, the four major Asian buyers imported 796,047 barrels per day (bpd) of Iranian crude in July, down from 798,400 bpd a year ago, according to official government data and tanker arrival schedules given to Reuters.

Between January and July, they imported 936,981 bpd, down 20 percent from the same seven months in 2012.

Japan, the last of the four to report its oil imports for July, imported 172,047 bpd of Iranian crude last month, data from the Ministry of Economy, Trade and Industry (METI) showed on Friday. Its imports fell 10 percent from a year ago to 183,914 bpd for the January to July period.

Japan's Iran imports rose last month from zero the previous July, marking a third-straight month of year-on-year gains.

Japan imported no Iranian oil in July 2012 for the first time since 1981 as Iran's No.3 oil buyer reined in its appetite to keep from falling afoul of European Union sanctions targeting shipping insurance coverage.

Industry sources had expected Japan could continue raising imports to offset steep cuts made in April due to uncertainties over the continuation of sovereign insurance on tankers carrying Iranian oil.

Last month, China and India cut their imports by 12.6 percent and 82.4 percent, respectively, while South Korea raised imports by 38.7 percent.

Replacement oil for the lost Iranian barrels has come from Iraq, Oman, United Arab Emirates, Latin America and Africa.

Japan needs to win its fourth six-month waiver from U.S. sanctions next month as part of a review process by unveiling plans to accelerate cuts in Iranian oil purchases. The waivers for the other Asian buyers will come up in November-December.-Reuters