Why The U.S. Wants China To Stop Importing Iranian Crude

·5 min read

In an attempt to increase pressure on Iran in order to push through a nuclear deal with Iran, the U.S. is considering cracking down on Iranian oil exports to China.

Chart of the Week

- The government of the United States is mulling a ban on Chinese imports of Iranian crude as it becomes increasingly clear that reaching a deal with Iran before the inauguration of its new government is unlikely.

- The oil markets see the U.S. somewhat unlikely to antagonize China further, yet Washington would be inclined to highlight that it has other options to opt for should the talks fail altogether.

- Verifiable Chinese imports of Iranian crude amounted to some 250kbpd over the course of H1-2021 according to vessel-tracking firm Kpler, a 130% increase year-on-year, largely coming on the back of Biden-era softening of rhetoric towards China.

- A significant volume of Iranian exports, however, is routinely trans-shipped in the region of the Malacca Straits, rendering the deciphering of their final destination all but impossible.

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- ExxonMobil (NYSE:XOM) shut down its 120kbpd Slagen Refinery in Norway last month, becoming the fifth European refinery to see its operations halted for good because of pandemics-triggered ramifications.

Tuesday, July 27, 2021

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By Josh Owens for Oilprice.com

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