U.S. Steps Up Sanctions on Chinese Imports of Iranian Oil

The U.S. has sanctioned a fourth oil import terminal in China for receiving Iranian oil cargoes as the State Department expanded sanctions against entities involved in trade with Iran. The U.S. Department of State designated a fourth China-based crude oil and petroleum products terminal, Zhoushan Jinrun Petroleum Transfer Co Ltd, as it “has a demonstrated pattern of accepting Iranian crude oil and petroleum products, including from U.S.-designated tankers.” Zhoushan Jinrun operates a terminal at Zhoushan, which is the base of some of China’s largest refineries. “This behavior continues to enable Iran’s ability to fund its nuclear ambitions, support terrorist groups, and enable disruption of the flow of trade and freedom of navigation in waterways that are crucial to global prosperity and economic growth,” the State Department said. Overall, the U.S. designated 20 entities around the world in the latest round of sanctions, including dark fleet operators and tankers, involved in the transport and acquisition of Iranian crude oil and petroleum products. Earlier this year, the U.S. targeted with sanctions Chinese oil terminals and several independent refiners, the so-called teapots, which have struggled since then to procure the cheap Iranian oil. Some refineries in the Shandong province, home to the teapots, have stopped buying Iranian crude for fear of being next on the list of sanctions. Despite the U.S. crackdown on Chinese entities involved in the imports of Iran’s crude and products, China continues to buy large volumes of Iranian oil—it is actually Tehran’s main customer, buying 90% of its exported oil. First-half imports from Iran at the major Chinese port clusters were estimated at nearly 1.4 million barrels per day (bpd). Ports near industrial clusters Qingdao, Dalian, and Zhoushan are importing crude from Iran in several legs from the Persian Gulf via Malaysia with ship-to-ship (STS) transfers using shadow fleet vessels and tankers blacklisted by the United States. Officially, China’s customs data show there haven’t been any crude imports from Iran since 2022. Unofficially, China buys nearly 90% of all of Iran’s crude exports in multiple-stage journeys and transfers from one tanker to another. By Tsvetana Paraskova for Oilprice.com