- China increases crude oil import from Iran.
- Brazil, Angola and Russia forced to slash prices and divert shipments.
- Despite tough U.S. sanctions, Iranian oil started to slip into China from late 2019.
- Between November-March, China received a daily average of 557,000 barrels of Iranian crude.
China’s import of crude oil from Iran in recent months has increased, forcing sellers of oil from countries such as Brazil, Angola and Russia to slash prices and divert shipments to India and Europe.
According to reports, despite tough U.S sanctions, Iranian oil started to slip into China from late 2019. However volumes began to surge only since late last year as oil rebounded above $60 and buyers were emboldened by the prospect of the United States lifting sanctions under President Joe Biden.
According to Refinitiv Oil Research, China received a daily average of 557,000 barrels of Iranian crude between November and March, or roughly 5% of total imports by the world’s biggest importer.
Most of these oil are said to end up in the eastern province of Shandong, China’s hub for independent refiners.
However, the surge in Iranian supplies, has not affected the market share of Saudi Arabia, which is China’s top oil supplier. This is because the OPEC kingpin serves a different client base – China’s state refiners and mega private plants.
Iranian oil flows are expected to continue, especially as the private firms face little political pressure to quit the lucrative business