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Business Times
09-05-2025
- Business
- Business Times
US sanctions on China refiners over Iran oil disrupt operations: sources
[SINGAPORE] Recent US sanctions on two small Chinese refiners for buying Iranian oil have created difficulties receiving crude and led them to sell product under other names, sources familiar with the matter said, evidence of the disruption that Washington's stepped-up pressure is inflicting on Tehran's biggest oil buyer. The targeting of independent refiners, known as teapots, marked an escalation in Washington's efforts to cut off Tehran's export revenue as US President Donald Trump seeks to pressure Iran into a deal over its nuclear programme. Washington's sanctions against Shandong Shouguang Luqing Petrochemical in March and Shandong Shengxing Chemical in April have also begun to deter other, larger independent Chinese refiners from buying Iranian crude, three of the sources said. About five plants in the refining hub of Shandong province have halted purchases of Iranian oil since last month, worried about being hit by sanctions, two trading executives said. That wariness is the main reason discounts for Iranian Light have widened to US$2.30 to US$2.40 a barrel against ICE Brent from about US$2 a month ago, the executives and another source said. Among the inconveniences faced by the two sanctioned teapots, state-run Shandong Port Group, the main port operator in the province, has denied entry to vessels loaded with crude they have purchased, five trade sources said. That follows the port group's January ban on port calls by US-sanctioned tankers. Shandong Port Group and Shengxing did not respond to requests for comment. A Luqing executive declined to comment. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Large state banks have also stopped providing Luqing with operational capital for purchasing crude, forcing it to work with smaller banks, four of the sources said. The sources declined to be identified due to the sensitivity of the matter. Beijing says it opposes unilateral sanctions and defends as legitimate its trade with Iran, which ships about 90 per cent of its oil exports to China. However, Chinese customs data has not shown any oil shipped from Iran since July 2022, with Iranian crude imports instead labelled as originating from Malaysia or other countries. Shipping, sales headaches The Shandong Port Group's banning of cargoes for the two refineries has forced them to discharge at other ports, according to three sources. In one case, the tanker Bei Hai Ming Wang carrying oil for the Shengxing refinery was rejected when it sought to land at the Laizhou port, controlled by Shandong Port Group, around Apr 21, according to a source familiar with the matter. It eventually unloaded on May 2 at the privately owned Wantong Crude Oil Terminal in neighbouring Dongying, data from analytics firm Vortexa showed. In another sign of trading disruption from the sanctions, two Asia-based oil product traders who had previously dealt with Luqing said they stopped doing so after it was sanctioned. In addition, no shipments of petrol blendstock have been recorded since the end of March out of Laizhou port, used by Luqing for most of its blendstock exports, Kpler and LSEG ship tracking data showed. That contrasts with the first three months of this year when 83,000 metric tonnes (701,000 barrels) of methyl tertiary butyl ether, a key petrol blendstock export, were shipped from Laizhou, accounting for 15 per cent of China's total outflow of the blendstock. State giant China National Offshore Oil Corporation (Cnooc) stopped supplying crude to Shandong Haihua Group's 40,000 barrel-per-day refinery, operated by Luqing, shortly after the US sanctions were announced, three trade sources and a Shandong-based Chinese oil market consultant said. Cnooc did not respond to a request for comment. Calls to Haihua went unanswered. The two teapots have also begun selling product through new entities, according to seven trade sources, with Luqing using Shouguang Jiaqing Petroleum Sales and Shengxing selling via Shandong Xuxing Petrochemical. Calls to the two entities seeking comment went unanswered. REUTERS
Yahoo
08-05-2025
- Business
- Yahoo
Exclusive-US sanctions on China refiners over Iran oil disrupt operations, sources say
By Siyi Liu, Trixie Yap and Chen Aizhu SINGAPORE (Reuters) -Recent U.S. sanctions on two small Chinese refiners for buying Iranian oil have created difficulties receiving crude and led them to sell product under other names, sources familiar with the matter said, evidence of the disruption that Washington's stepped-up pressure is inflicting on Tehran's biggest oil buyer. The targeting of independent refiners, known as teapots, marked an escalation in Washington's efforts to cut off Tehran's export revenue as President Donald Trump seeks to pressure Iran into a deal over its nuclear programme. Washington's sanctions against Shandong Shouguang Luqing Petrochemical in March and Shandong Shengxing Chemical in April have also begun to deter other, larger independent Chinese refiners from buying Iranian crude, three of the sources said. About five plants in the refining hub of Shandong province have halted purchases of Iranian oil since last month, worried about being hit by sanctions, two trading executives said. That wariness is the main reason discounts for Iranian Light have widened to $2.30-$2.40 a barrel against ICE Brent from about $2 a month ago, the executives and another source said. Among the inconveniences faced by the two sanctioned teapots, state-run Shandong Port Group, the main port operator in the province, has denied entry to vessels loaded with crude they have purchased, five trade sources said. That follows the port group's January ban on port calls by U.S.-sanctioned tankers. Shandong Port Group and Shengxing did not respond to requests for comment. A Luqing executive declined to comment. Large state banks have also stopped providing Luqing with operational capital for purchasing crude, forcing it to work with smaller banks, four of the sources said. The sources declined to be identified due to the sensitivity of the matter. Beijing says it opposes unilateral sanctions and defends as legitimate its trade with Iran, which ships about 90% of its oil exports to China. However, Chinese customs data has not shown any oil shipped from Iran since July 2022, with Iranian crude imports instead labelled as originating from Malaysia or other countries. SHIPPING, SALES HEADACHES The Shandong Port Group's banning of cargoes for the two refineries has forced them to discharge at other ports, according to three sources. In one case, the tanker Bei Hai Ming Wang carrying oil for the Shengxing refinery was rejected when it sought to land at the Laizhou port, controlled by Shandong Port Group, around April 21, according to a source familiar with the matter. It eventually unloaded on May 2 at the privately owned Wantong Crude Oil Terminal in neighbouring Dongying, data from analytics firm Vortexa showed. In another sign of trading disruption from the sanctions, two Asia-based oil product traders who had previously dealt with Luqing said they stopped doing so after it was sanctioned. In addition, no shipments of gasoline blendstock have been recorded since the end of March out of Laizhou port, used by Luqing for most of its blendstock exports, Kpler and LSEG shiptracking data showed. That contrasts with the first three months of this year when 83,000 metric tons (701,000 barrels) of methyl tertiary butyl ether, a key gasoline blendstock export, were shipped from Laizhou, accounting for 15% of China's total outflow of the blendstock. State giant CNOOC stopped supplying crude to Shandong Haihua Group's 40,000 barrel-per-day refinery, operated by Luqing, shortly after the U.S. sanctions were announced, three trade sources and a Shandong-based Chinese oil market consultant said. CNOOC did not respond to a request for comment. Calls to Haihua went unanswered. The two teapots have also begun selling product through new entities, according to seven trade sources, with Luqing using Shouguang Jiaqing Petroleum Sales and Shengxing selling via Shandong Xuxing Petrochemical. Calls to the two entities seeking comment went unanswered.
Yahoo
08-05-2025
- Business
- Yahoo
Exclusive-US sanctions on China refiners over Iran oil disrupt operations, sources say
By Siyi Liu, Trixie Yap and Chen Aizhu SINGAPORE (Reuters) -Recent U.S. sanctions on two small Chinese refiners for buying Iranian oil have created difficulties receiving crude and led them to sell product under other names, sources familiar with the matter said, evidence of the disruption that Washington's stepped-up pressure is inflicting on Tehran's biggest oil buyer. The targeting of independent refiners, known as teapots, marked an escalation in Washington's efforts to cut off Tehran's export revenue as President Donald Trump seeks to pressure Iran into a deal over its nuclear programme. Washington's sanctions against Shandong Shouguang Luqing Petrochemical in March and Shandong Shengxing Chemical in April have also begun to deter other, larger independent Chinese refiners from buying Iranian crude, three of the sources said. About five plants in the refining hub of Shandong province have halted purchases of Iranian oil since last month, worried about being hit by sanctions, two trading executives said. That wariness is the main reason discounts for Iranian Light have widened to $2.30-$2.40 a barrel against ICE Brent from about $2 a month ago, the executives and another source said. Among the inconveniences faced by the two sanctioned teapots, state-run Shandong Port Group, the main port operator in the province, has denied entry to vessels loaded with crude they have purchased, five trade sources said. That follows the port group's January ban on port calls by U.S.-sanctioned tankers. Shandong Port Group and Shengxing did not respond to requests for comment. A Luqing executive declined to comment. Large state banks have also stopped providing Luqing with operational capital for purchasing crude, forcing it to work with smaller banks, four of the sources said. The sources declined to be identified due to the sensitivity of the matter. Beijing says it opposes unilateral sanctions and defends as legitimate its trade with Iran, which ships about 90% of its oil exports to China. However, Chinese customs data has not shown any oil shipped from Iran since July 2022, with Iranian crude imports instead labelled as originating from Malaysia or other countries. SHIPPING, SALES HEADACHES The Shandong Port Group's banning of cargoes for the two refineries has forced them to discharge at other ports, according to three sources. In one case, the tanker Bei Hai Ming Wang carrying oil for the Shengxing refinery was rejected when it sought to land at the Laizhou port, controlled by Shandong Port Group, around April 21, according to a source familiar with the matter. It eventually unloaded on May 2 at the privately owned Wantong Crude Oil Terminal in neighbouring Dongying, data from analytics firm Vortexa showed. In another sign of trading disruption from the sanctions, two Asia-based oil product traders who had previously dealt with Luqing said they stopped doing so after it was sanctioned. In addition, no shipments of gasoline blendstock have been recorded since the end of March out of Laizhou port, used by Luqing for most of its blendstock exports, Kpler and LSEG shiptracking data showed. That contrasts with the first three months of this year when 83,000 metric tons (701,000 barrels) of methyl tertiary butyl ether, a key gasoline blendstock export, were shipped from Laizhou, accounting for 15% of China's total outflow of the blendstock. State giant CNOOC stopped supplying crude to Shandong Haihua Group's 40,000 barrel-per-day refinery, operated by Luqing, shortly after the U.S. sanctions were announced, three trade sources and a Shandong-based Chinese oil market consultant said. CNOOC did not respond to a request for comment. Calls to Haihua went unanswered. The two teapots have also begun selling product through new entities, according to seven trade sources, with Luqing using Shouguang Jiaqing Petroleum Sales and Shengxing selling via Shandong Xuxing Petrochemical. Calls to the two entities seeking comment went unanswered.
Reuters
08-05-2025
- Business
- Reuters
Exclusive: US sanctions on China refiners over Iran oil disrupt operations, sources say
SINGAPORE, May 8 (Reuters) - Recent U.S. sanctions on two small Chinese refiners for buying Iranian oil have created difficulties receiving crude and led them to sell product under other names, sources familiar with the matter said, evidence of the disruption that Washington's stepped-up pressure is inflicting on Tehran's biggest oil buyer. The targeting of independent refiners, known as teapots, marked an escalation in Washington's efforts to cut off Tehran's export revenue as President Donald Trump seeks to pressure Iran into a deal over its nuclear programme. Washington's sanctions against Shandong Shouguang Luqing Petrochemical in March and Shandong Shengxing Chemical in April have also begun to deter other, larger independent Chinese refiners from buying Iranian crude, three of the sources said. About five plants in the refining hub of Shandong province have halted purchases of Iranian oil since last month, worried about being hit by sanctions, two trading executives said. That wariness is the main reason discounts for Iranian Light have widened to $2.30-$2.40 a barrel against ICE Brent from about $2 a month ago, the executives and another source said. Among the inconveniences faced by the two sanctioned teapots, state-run Shandong Port Group, the main port operator in the province, has denied entry to vessels loaded with crude they have purchased, five trade sources said. That follows the port group's January ban on port calls by U.S.-sanctioned tankers. Shandong Port Group and Shengxing did not respond to requests for comment. A Luqing executive declined to comment. Large state banks have also stopped providing Luqing with operational capital for purchasing crude, forcing it to work with smaller banks, four of the sources said. The sources declined to be identified due to the sensitivity of the matter. Beijing says it opposes unilateral sanctions and defends as legitimate its trade with Iran, which ships about 90% of its oil exports to China. However, Chinese customs data has not shown any oil shipped from Iran since July 2022, with Iranian crude imports instead labelled as originating from Malaysia or other countries. The Shandong Port Group's banning of cargoes for the two refineries has forced them to discharge at other ports, according to three sources. In one case, the tanker Bei Hai Ming Wang carrying oil for the Shengxing refinery was rejected when it sought to land at the Laizhou port, controlled by Shandong Port Group, around April 21, according to a source familiar with the matter. It eventually unloaded on May 2 at the privately owned Wantong Crude Oil Terminal in neighbouring Dongying, data from analytics firm Vortexa showed. In another sign of trading disruption from the sanctions, two Asia-based oil product traders who had previously dealt with Luqing said they stopped doing so after it was sanctioned. In addition, no shipments of gasoline blendstock have been recorded since the end of March out of Laizhou port, used by Luqing for most of its blendstock exports, Kpler and LSEG shiptracking data showed. That contrasts with the first three months of this year when 83,000 metric tons (701,000 barrels) of methyl tertiary butyl ether, a key gasoline blendstock export, were shipped from Laizhou, accounting for 15% of China's total outflow of the blendstock. State giant CNOOC stopped supplying crude to Shandong Haihua Group's 40,000 barrel-per-day refinery, operated by Luqing, shortly after the U.S. sanctions were announced, three trade sources and a Shandong-based Chinese oil market consultant said. CNOOC did not respond to a request for comment. Calls to Haihua went unanswered. The two teapots have also begun selling product through new entities, according to seven trade sources, with Luqing using Shouguang Jiaqing Petroleum Sales and Shengxing selling via Shandong Xuxing Petrochemical. Calls to the two entities seeking comment went unanswered.
Yahoo
12-02-2025
- Business
- Yahoo
US sanctions strand Iran, Russia oil on tankers, driving up crude costs
By Siyi Liu and Chen Aizhu SINGAPORE (Reuters) - The amount of Russian and Iranian oil held on ships has hit multi-month highs as harsher U.S. sanctions reduced the number of buyers, leaving fewer tankers available to deliver cargoes and driving up crude costs, trade sources and analysts said. Washington has imposed multiple rounds of sanctions on ships and entities dealing with oil from Iran and Russia since October, disrupting trade with major importers China and India. U.S. President Donald Trump last week restored his "maximum pressure" campaign on Iran that includes efforts to drive its oil exports down to zero in order to stop Tehran from obtaining a nuclear weapon. The OPEC producer has struggled to attract new vessels to fill the shipping capacity gap since the sanctions were imposed in the fourth quarter, said Xu Muyu, a senior analyst at data analytics firm Kpler. A ban last month by China's Shandong Port Group on sanctioned tankers from calling at its ports in the eastern province, home to most of the independent refiners that are the main buyers of Russian and Iranian oil, has also made it difficult for such cargoes to discharge. Shipbroker Braemar ACM said 57% of the 126 Very Large Crude Carriers (VLCCs) currently involved in Iran's crude trade to China are already subject to U.S. sanctions. As exports have risen and deliveries to China have dropped, the amount of Iranian oil in floating storage has expanded by between 10 million and 20 million barrels so far this year, according to three analysts' estimates. However, calculations of the total volume of Iranian oil in floating storage vary widely as the analysts use different methodologies to track the so-called shadow fleet. Data from Kpler showed Iranian oil floating storage at more than 25 million barrels, the highest in more than a year, with about 80% of the cargoes floating off the waters of Singapore and Malaysia. In contrast, Emma Li, a senior analyst at tanker tracker Vortexa Analytics, estimates the volume of Iranian crude and condensate in floating storage stood at 73.1 million barrels at end-January. Iran's exports rose for a second month to 1.78 million barrels in January after hitting a two-year low of 1.45 million in November, she said. "Smuggling techniques such as deactivating and spoofing AIS transponders and undertaking ship-to-ship transfers means there may be even more Iranian oil starting to float," said Richard Bronze, head of geopolitics at consultancy Energy Aspects. With fewer non-sanctioned ships to deliver oil to China, crude prices have climbed. Discounts for flagship Iranian Light crude have narrowed to 50 cents per barrel against ICE Brent, a multi-year peak, versus discounts of $2.50 per barrel about two months ago, on a delivered ex-ship (DES) basis to Shandong province for a cargo arriving in March, traders said. RUSSIA For Russian oil, tougher sanctions imposed a month ago by the outgoing Biden administration have driven up costs for refiners in China and India, with March ESPO Blend crude traded at $2 to $3 above ICE Brent on a DES basis to China, the highest premiums in more than two years, three trade sources said. And transport costs have soared, too, with fewer vessels available. The cost of shipping oil from Russia's Far East to north China last stood at around $4.5 million, roughly triple what it was before the latest U.S. sanctions, though down from as high as $7 million shortly after they were announced. Russian crude-on-water hit a two-month high of 88 million barrels on January 27, 24% higher than on January 10 when the sanctions were announced, Kpler data showed. The volume has declined since late January as Russian crude exports fell, while some cargoes have discharged, Kpler's Xu said. Also, several vessels previously engaged in moving Iranian oil are switching to Russian trade, she added. Sign in to access your portfolio
