Imports Of Iranian Crude Oil In China Find New Market: Report (image@ Lloydslits.com)
Iranian crude oils are flowing into the port and refining city of Dalian, China since late last year, helping the country in sustaining purchases of the oil at near record levels, said Reuters. The higher crude oil price has pushed the small buyers in the independent refining hub of Shandong province from pitching for crude oil from Iran, shifting the imports to another market.
As per the report, the demand of Iranian crude oil declined in the face of deteriorating refining margins, squeezed by higher crude prices but weaker-than-expected fuel demand.
Read also: A Chinese Pitch For Direct Flights Between India And China
Iran, including its oil resources, is sanctioned by US. The sanction was reinstated in 2018, over concerns regarding Tehran’s nuclear program. However, China did not stop buying Iranian oil, with margin-driven independent plants filling a vacuum left by sanctions-wary state firms said Reuters.
According to Vortexa, a consultancy that tracks tanker flows, 23 cargoes, or a total of 45 million barrels, of Iranian oil was discharged at Dalian between October 2023 and June 2024. It said this included 28 million barrels discharged at Changxing island, about 85 km (53 miles) northwest of central Dalian.
Kpler, another consultancy said that China has imported 34 million barrels into Dalian during the same period. The figures equate to 124,000-164,000 barrels per day, roughly constituting to 13 percent of China’s total Iranian oil imports during the first half of 2024.
According to analysts estimate, China imported 1.2-1.4 million bpd of Iranian crude during the period. Vortexa said the imports hit a record 1.52 million bpd last October.
Read also: Saudi Arabia Turns To Kuwait For Fuel Oil To Meet Summer Demands
Beijing’s Foreign Ministry told Reuters that China and Iran “have always maintained normal and legitimate trade under the international legal framework.”
China opposes unilateral sanctions. Reuters said there are still tanker trackers and dealers say that traders ‘rebrand’ Iranian oil destined for China as originating from elsewhere, such as Malaysia, Oman or the United Arab Emirates. Chinese customs have officially not reported any imports of Iranian oil since June 2022.
