The tightened U.S. sanctions on Iranian oil flows under the Trump Administration’s renewed maximum pressure campaign have created chaos in Iran’s oil exports to its single biggest buyer, China.
Trafigura Group’s head of oil trading Ben Luckock has named U.S. foreign policy towards Iran as the biggest upside risk to crude prices in an otherwise well-supplied market.
An increase in ship-to-ship transfers, plus the emergence of alternative receiving terminals, led to the jump, according to traders who participate in the market and asked not to be identified because the matter is sensitive.
Iran called on all members of the OPEC oil cartel last week to take united action against the U.S.’s ramping up of sanctions on the Islamic Republic. The statement from its President Masoud Pezeshkian followed Donald Trump’s instruction to his key cabinet colleagues to increase sanctions on Iran to reduce its oil exports to zero.
Oil edged down as US President Donald Trump’s renewed pledge to drive down the price of crude overshadowed his push for tighter Iranian sanctions.
China has been importing Iranian oil indirectly via proxies. According to StanChart, crude oil imports from Malaysia clocked in at 1.456 million barrels per day (mb/d) in June, the second-highest monthly average on record.
Crude oil prices started trade today with a dip despite the latest news around President Donald Trump who on Tuesday confirmed he would be returning to a maximum pressure approach to Iran, aiming to reduce its oil exports to zero, and said he wants the U.S. to take over the Gaza Strip and develop it.
A cold snap has forced school closures and other disruptions to public life across much of Iran, as authorities grapple with a shortage of natural gas for heating and electricity generation.
These plants only started buying Iranian crude this year after receiving guidance from the US State Department that sanctions wouldn’t be enforced by the Biden administration, according to a note from the industry consultant, which didn’t name the refiners
A recent report in Bloomberg has collected and analyzed five years of satellite images monitoring the South China Sea off Malaysia to detail something which should come as no surprise: Iran and China’s sanction-busting activity regarding Iranian oil exports has been going strong.