Latest news with #ShouguangLuqingPetrochemical
Arab News
26-03-2025
- Business
- Arab News
Oil Updates — crude near 3-week high on supply fears, US stocks drop
NEW YORK/SINGAPORE: Oil prices edged higher on Wednesday on supply concerns with the US stepping up efforts to limit Venezuelan and Iranian oil exports, while a bigger-than-expected drop in US crude inventories also lent support. Brent crude futures gained 20 cents, or 0.3 percent, to $73.22 a barrel by 7:04 a.m. Saudi time, while US West Texas Intermediate crude futures rose 20 cents, or 0.3 percent, to $69.20 a barrel. Both contracts hit their highest in three weeks in the previous session. 'Crude oil prices maintain their bullish bias after Trump's sanctions on Venezuelan oil, raising supply-side concerns,' Priyanka Sachdeva, a senior market analyst at Phillip Nova, wrote in a market commentary on Wednesday. On Monday Trump signed an executive order authorizing his administration to impose blanket 25 percent tariffs under the 1977 International Emergency Economic Powers Act on imports from any country that buys Venezuelan crude oil and liquid fuels. Oil is Venezuela's main export. China, already a target of US import tariffs, is its largest buyer. Trade of Venezuelan oil to top buyer China stalled on Tuesday, as Chinese traders and refiners said they were waiting to see how the order would be implemented and whether Beijing would direct them to stop buying. Washington last week also imposed a new round of sanctions on Iran's oil sales targeting entities including Shouguang Luqing Petrochemical, a 'teapot,' or independent refinery in east China's Shandong province, and vessels that supplied oil to such plants in China, the top buyers of Iranian crude. The market was also buoyed by American Petroleum Institute data that showed US crude inventories fell by 4.6 million barrels last week, a sign of healthy demand for fuel in the world's largest economy. Analysts polled by Reuters were expecting a decline of 1 million barrels. Official US government data on crude inventories is due on Wednesday. The upswing in oil prices is a temporary phenomenon, with the potential economic slowdown due to Trump's tariffs keeping a lid on price gains, Phillip Nova's Sachdeva said. Further capping oil prices, the US reached deals with Ukraine and Russia to pause attacks at sea and against energy targets, with Washington agreeing to push to lift some sanctions against Moscow. Kyiv and Moscow both said they would rely on Washington to enforce the deals, while expressing skepticism that the other side would abide by them.
Zawya
21-03-2025
- Business
- Zawya
New US sanctions to slow but not stop China's Iranian oil imports, traders say
Iranian oil shipments into China are set to fall in the near-term after new U.S. sanctions on a refiner and tankers, driving up shipping costs, but traders said they expect buyers to find workarounds to keep at least some volumes flowing. Washington on Thursday imposed new sanctions on entities including Shouguang Luqing Petrochemical, a "teapot," or independent refinery in east China's Shandong province, and vessels that supplied oil to such plants in China, the top buyers of Iranian crude. It was the fourth round of sanctions on Iran's oil sales since President Donald Trump's February call for "maximum pressure" on Tehran, including efforts to drive its crude exports to zero. Iranian oil flows to China had already dropped due to rising freight costs as earlier sanctions hit shipping capacity, said traders, including three directly involved in the business. A Chinese trading executive involved in Iranian oil business said the latest sanctions did not come as a surprise and expects that more plants or terminals could be targeted. "But once companies re-adjust their business structures, imports would continue," said the executive, referring to measures such as changing entities for oil payments. Still, imports may be curbed as the sanctions give larger private refiners pause, said a second Chinese trader. Freight costs for a Very Large Crude Carrier, or VLCC, sailing from waters near Malaysia, a key transshipment point for Iranian oil, to China's refining hub Shandong have more than doubled since late 2024 to $3-$4 per barrel, the first executive added. China's Iranian oil imports recovered in February to 1.43 million bpd, from 898,000 bpd in January, data from analytics firm Kpler showed. About 33 million barrels have been delivered this month, with volumes forecast to reach 1.7 million bpd before the latest sanctions, senior Kpler analyst Muyu Xu said, adding that discharge volumes for the rest of March could decline sharply due to the sanctions. Most Iranian oil shipments to China, which make up over 10% of its crude imports, are rebranded by traders as sourced from Malaysia. "This marks a clear escalation in sanctions policy, though not as severe as if a Chinese port had been designated," said Brian Leisen, commodities strategist at RBC Capital. 'INDISCRIMINATE AND ILLEGAL' China, which defends its trade with Iran as legitimate, on Friday reiterated its opposition to "indiscriminate and illegal" unilateral sanctions and pledged to protect the rights of Chinese enterprises, which one trader said buyers would take comfort from. Luqing, which operates a 160,000 bpd refinery, is among the larger regular buyers of discounted Iranian oil, according to traders. It is the second teapot sanctioned by the U.S. after Haiyou Petrochemical was designated in 2022. A person answering the phone at Luqing did not have immediate comment on Friday. The company did not immediately respond to an email seeking comment. Oil from Iran, Venezuela and Russia shunned by many Western buyers has saved Chinese refineries billions of dollars in recent years as flagging economic growth and stagnant fuel demand depress margins. One trader dealing in Iranian oil said a teapot operator seemed unfazed by Thursday's announcement. "Our regular client appeared nonchalant when I shared the sanction document translated into Chinese late last night and carried on asking for the latest Iranian oil quotes," the trader said. (Reporting by Chen Aizhu and Florence Tan Editing by Tony Munroe, William Maclean)
Al Arabiya
21-03-2025
- Business
- Al Arabiya
New US sanctions to slow but not stop China's Iranian oil imports, traders say
Iranian oil shipments into China are set to fall in the near-term after new US sanctions on a refiner and tankers, driving up shipping costs, but traders said they expect buyers to find workarounds to keep at least some volumes flowing. Washington on Thursday imposed new sanctions on entities including Shouguang Luqing Petrochemical, a 'teapot,' or independent refinery in east China's Shandong province, and vessels that supplied oil to such plants in China, the top buyers of Iranian crude. It was the fourth round of sanctions on Iran's oil sales since President Donald Trump's February call for 'maximum pressure' on Tehran, including efforts to drive its crude exports to zero. Iranian oil flows to China had already dropped due to rising freight costs as earlier sanctions hit shipping capacity, said traders, including three directly involved in the business. A Chinese trading executive involved in Iranian oil business said the latest sanctions did not come as a surprise and expects that more plants or terminals could be targeted. 'But once companies re-adjust their business structures, imports would continue,' said the executive, referring to measures such as changing entities for oil payments. Still, imports may be curbed as the sanctions give larger private refiners pause, said a second Chinese trader. Freight costs for a Very Large Crude Carrier, or VLCC, sailing from waters near Malaysia, a key transshipment point for Iranian oil, to China's refining hub Shandong have more than doubled since late 2024 to $3-$4 per barrel, the first executive added. China's Iranian oil imports recovered in February to 1.43 million bpd, from 898,000 bpd in January, data from analytics firm Kpler showed. About 33 million barrels have been delivered this month, with volumes forecast to reach 1.7 million bpd before the latest sanctions, senior Kpler analyst Muyu Xu said, adding that discharge volumes for the rest of March could decline sharply due to the sanctions. Most Iranian oil shipments to China, which make up over 10% of its crude imports, are rebranded by traders as sourced from Malaysia. 'This marks a clear escalation in sanctions policy, though not as severe as if a Chinese port had been designated,' said Brian Leisen, commodities strategist at RBC Capital. 'Indiscriminate and illegal' China, which defends its trade with Iran as legitimate, on Friday reiterated its opposition to 'indiscriminate and illegal' unilateral sanctions and pledged to protect the rights of Chinese enterprises, which one trader said buyers would take comfort from. Luqing, which operates a 160,000 bpd refinery, is among the larger regular buyers of discounted Iranian oil, according to traders. It is the second teapot sanctioned by the U.S. after Haiyou Petrochemical was designated in 2022. A person answering the phone at Luqing did not have immediate comment on Friday. The company did not immediately respond to an email seeking comment. Oil from Iran, Venezuela and Russia shunned by many Western buyers has saved Chinese refineries billions of dollars in recent years as flagging economic growth and stagnant fuel demand depress margins. One trader dealing in Iranian oil said a teapot operator seemed unfazed by Thursday's announcement. 'Our regular client appeared nonchalant when I shared the sanction document translated into Chinese late last night and carried on asking for the latest Iranian oil quotes,' the trader said.
