Iran sent a record amount of crude oil to China. Tankers carrying approximately 22 million barrels of Iranian oil are en route to the Chinese port of Dalian, according to an unnamed Iranian shipping source and data on Refinitiv Eikon cited by Reuters.
This comes ahead of the US sanctions that are due to hit the Iranian energy sector and oil exports on November 4th.
Reuters cited an unnamed source in the National Iranian Tanker Company who claimed that the country is shipping the record amount. “As our leaders have said it will be impossible to stop Iran from selling its oil. We have various ways of selling our oil and when the tankers reach Dalian, we will decide whether to sell it to other buyers or to China,” the source said, without providing any more details.
According to data that dates back to January 2015, Dalian usually receives 1 to 3 million barrels monthly from the National Iranian Tanker Co (NITC). However, the amount of approximately 22 million is expected to arrive between October and November.
Iran is the third largest producer in the Organization of the Petroleum Exporting Countries (OPEC). However, it appears to be having difficulties finding buyers for its crude oil, due to the incoming US sanctions and the constant vows of US officials that want to reduce Iran’s oil exports to “zero.”
Dalian holds some of the biggest refineries and commercial oil storage facilities in China. Iran used to store its oil at Dalian in 2014, prior to the Iran Nuclear Deal. The oil was then sold to South Korea and India, according to Reuters.
Reuters also reported that one of 11 Very Large Crude Carriers (VLCCs) – Dune – discharged oil into a bonded storage tank at the Xingang section of the Dalian port on Oct. 8. The VLCC Dino I switched off its transponder on Oct. 13 near the port. Dino reappeared near Taiwan and has no cargo.
Reuters cited sources familiar with the matter that China National Petroleum Corp is not expecting any Iranian oil to arrive in Dalian. The source also added that it is unlikely for buyers to lift Iranian oil from bonded tanks due to the US sanctions.
According to Refinitiv Eikon shipping data, Iranian tanks are now switching off their tracking devices when they load or discharge oil to avoid US authorities.
There is currently no comment from the NITC and the Dalian port.
Reuters also cited industry sources which claimed that Turkey’s top refiner, Tupras, is in talks with U.S. officials to obtain a waiver allowing it to keep buying Iranian oil after Washington reinstates sanctions on the Islamic Republic’s energy sector in November. There has been no official confirmation from either the Turkish or US side on this.
It might actually happen as a package of several US concessions due to controversy around the disappearance and possible murder of Khashoggi. Ankara is the side, which has capabilities to impact a possible public and diplomatic damage that the US and Saudi Arabia will likely suffer when the truth over the assassination is revealed.
If this information is in fact true, this is a large blow against repeated US vows to reduce Iranian oil exports to “zero.” As SouthFront previously reported, constant US pressure on Iran, China and Russia will more than likely result in their deeper cooperation. This is further reinforced after on October 18th, US Special Representative for Ukraine Negotiations Kurt Volker said that the US may impose new sanctions on Moscow every month or two. This is due a supposed attempt “to increase the pressure we are putting on Russia in order to get them [Russian leadership] to negotiate toward a solution.” The approach includes keeping existing sanctions in place and introducing new ones periodically. He also praised the EU for being resilient in imposing its own sanctions.
On July 25th, the Daily Beast claimed that the former US Secretary of State had advised Trump to “box-in” China by working with Russia. In the cold-war era, Henry Kissinger was the mastermind behind US policy to improve diplomatic relations with China to isolate the Soviet Union. “That particular article was a great piece – of fiction,” Kissinger said on September 13th. In the modern day, he continues to claim that it remains a useful tool to deter Russia.
“I visualize China as a potential partner in the construction of a world order,” Kissinger further commented. “Of course, if that does not succeed, we will be in a position of conflict, but my thinking is based on the need to avoid that situation. So, our problem is not to find allies around the world with which to confront China.”
However, it is to be expected for relations between China and Russia to improve. Because currently, with its policy the US is pushing both Russia and China away from itself and towards each other. Thus, the end goal of asserting dominance appears to be undermined from within.
This is further reinforced by Putin’s remarks on October 18th that Russia may become a guarantor of North Korean security and had nothing but praise for China. The stability of the Korean peninsula is a security goal of significance for both Moscow and Beijing and they may cooperate on it. Securing stability in the region would further reduce US military influence, since that is one of the arguments for US troops to be present there.