China Imports Iranian Crude Despite US Sanctions

China Imports Iranian Crude Despite US Sanctions

China continued imports of Iranian crude oil in July, two months after the expiry of US sanctions waivers, research from three firms tracking tanker movement has shown, according to Reuters.

Last month, the US Treasury slapped sanctions on Chinese oil trader Zhuhai Zhengrong Ltd and its CEO Youmin Li after a Bloomberg report accused China of getting around tough US energy sanctions by putting the Iranian imports into bonded storage.

China is the only major traditional importer of Iranian crude oil not to have bowed to US sanctions pressure, with most other major importers, including India, Italy, Japan, South Korea, Greece and Turkey stopping imports out of fear of US sanctions. Before sanctions snapped into place, China relied on Iran for about 20 percent of its total imports, with this figure declining to about half that after the expiry of US sanctions waivers.

China’s defiance in continuing imports of Iranian oil are said to be a headache for the Trump administration, which recently estimated that between 50 and 70 percent of Iran’s oil exports now head to China, with 30 percent more going to Syria, with the latter country not concerned by US sanctions threats since it is already sanctioned itself, Russian media reported.

Last week, Iranian Vice President Eshaq Jahangiri urged China and other countries to buy even more Iranian oil, saying US sanctions threats have failed to collapse the Iranian economy, Russian Sputnik News wrote.

On July 23, Beijing strongly condemned the US’s “illegal sanctions on companies and individuals” after Washington slapped restrictions on a Chinese oil importer doing business with Iran, calling the sanctions “random” and stressing that they were a “violation of international law.”

Last week, the Bank of America warned that China’s continued purchases of Iranian crude threatened to trigger an oil market crash, to “undermine US foreign policy” and “cushion the negative terms-of-trade effects on the Chinese economy of rising US tariffs.”

The US slapped hard-hitting banking and energy sanctions on Iran after withdrawing from the Iran nuclear deal in May 2018, beginning a “maximum pressure” campaign aimed at bringing the oil-rich country’s energy exports down “to zero” and collapsing the Islamic Republic’s economy.

Tamara Kuzmanovic

Writer and journalist for Serbian, Swiss, Japanese and Singapore media since 1996. A former correspondent from the United Nations in Geneva. Based in the Serbian capital Belgrade I've also lived in Switzerland for 12 years. Graduated from College for marketing communication with a degree in advertising, English and public relations. My father was a Serbian MP and Belgrade University professor.

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