China Officially Buys 4 Million Barrels of Iran Oil

Date: 21 January 2022 - 22:05

News ID: ۹۹۱۳۹

SINGAPORE (Dispatches) – China has unloaded nearly 4 million barrels of Iranian crude into state storage tanks in the southern port city of Zhanjiang over the past few weeks, trade sources and ship-tracking specialist Vortexa Analytics said on Thursday.
The move comes as countries are in difficult negotiations with Iran to revive the 2015 nuclear deal, which included removing U.S. sanctions on Iranian oil. The former Trump administration withdrew from the agreement and reimposed sanctions.
Since 2018 sanctions have prevented Iran, which has the world’s fourth-largest oil reserves, from pumping oil at near-capacity levels.
The replenishment of China’s strategic petroleum reserve also comes ahead of a rare coordinated plan with the United States to release oil from emergency reserves to help cool global oil prices, which hit a seven-year high this week, Reuters said.
China has been importing Iranian oil, but shipments are not reflected in official customs data as buyers fear invoking U.S. sanctions. On Thursday, Chinese customs reported their first import of Iranian crude in a year, despite ongoing sanctions.
China imported 260,312 tonnes (1.9 million barrels) of Iranian crude in December, according to data from China’s General Administration of Customs, which last recorded double the inflow of Iranian oil in December 2020.
A senior trade source with knowledge of the shipment told Reuters that the special cargo was offloaded to a state storage location in Zhanjiang in late December.
Another cargo of a similar size was subsequently discharged to the same port for emergency storage, according to ship tracking specialist Vortexa Analytics.
“There were earlier reports of imports of Iranian crude — but some concealment. Now I think the Chinese are publicly testing the U.S. response,” said Tilak Doshi, managing director of Doshi Consulting in Singapore.

Reuters quoted what it called a senior oil ministry official as saying that Iran had publicly said its oil exports had increased significantly.
“We don’t disclose which countries due to U.S. sanctions, but China is one of the countries that buys Iranian oil. This shows that the sanctions have lapsed.”
Another Iranian official said our policy is to improve our trade with non-Western countries, including oil.
Asked about China’s storage of Iranian oil in national reserves and noted this in customs data, the State Department said U.S. sanctions remain in effect and will be enforced.
“We know that Chinese companies are buying Iranian oil. We have used our sanctions agencies to address sanctions evasion by Iran, including those doing business with China, and will continue to do so as necessary,” said a State Department spokeswoman who asked not to be named.
Shipments remained above 500,000 barrels a day between August and October, Reuters reported in November.
Crude oil imports from Iran account for about 6 percent of China’s crude oil imports, according to shipping data and trader estimates.
China is expected to release some of its inventory from its strategic stockpile around the Lunar New Year, Reuters reported last week.