Iran Sends Two Supertankers to China After 18 Days : Iran just endured the longest gap in at least three years without sending oil to its biggest customer, as imminent US sanctions pile pressure on Tehran.
Two supertankers left Iran’s biggest export terminal bound for China late Wednesday, ending an 18-day hiatus, according to ship-tracking data compiled by Bloomberg, World Oil reported.
While the pause in shipments probably does not mean China will bow to pressure from US President Donald Trump—Beijing is said to have resisted such curbs—it might indicate that the Asian country’s refineries want better terms for Iranian cargoes.
Regardless of the motivation, flows to China have plunged at a difficult moment for Iran, with buyers including South Korea, France and others either reducing or completely stopping their purchases due to US pressure.
Tanker tracking data compiled by Bloomberg indicate that OPEC’s fourth-largest exporter already has to store its crude amid dwindling demand.
China was the largest buyer of Iranian crude last year, accounting for almost a third of Iran’s crude and condensate exports. The Middle East country’s exports so far this month slumped to around 1.3 million barrels per day. They were as high as 3 million bpd back in 2016, the tanker tracking data show.
The Dino I and Dune, which can haul 4 million bpd between them, departed Kharg Island in the northern Persian Gulf within an hour of each other late Wednesday. Before that, the last vessel to make the journey was the supertanker Starla that left on Aug. 25 carrying 2 million bpd to Ningbo.
The pause in shipments to China has coincided with the return of Iranian oil stored on tankers close to the country’s export terminals. There are currently eight tankers holding 14 million bpd of Iranian crude or condensate, a form of light crude extracted from gas fields, anchored in the Persian Gulf.
On average, during the first eight months of this year, Iran shipped 660,000 bpd of oil to China. To maintain that rate of purchases, five to six supertankers, also known as very large crude carriers, should have left for China in the past 18 days.
Previously, the longest gap between vessels leaving Iran for China was 15 days between March 20 and April 4, but often it is three days or less. The last big interruption came after a flood of crude on the trade route in the first half of March. That is not the case this time.
The tanker-tracking data compiled by Bloomberg start in July 2015. Source: Financial Tribune