China gets Iranian oil on Persian tankers
21 Aug 2018
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Even as European oil companies are moving out of Iran, fearing reprisals from the US, China has decided to use tankers from the Persian nation for supplies of the commodity.
China is reported to have started using oil tankers owned by the National Iranian Tanker Co. With the US engaged in a bitter trade war with China, Beijing has had to cut its oil imports from America and increase sourcing from Iran. It is already the largest importer of Iranian oil.
The US has reimposed sanctions against buying of Iranian crude and European nations, which were opposed to the move, are falling in line as their oil MNCs are backing out of Iran.
America has also told other buyers of Iranian oil to stop importing oil from Iran by November. While most European nations have already slashed imports, Japan, South Korea and even India are cutting down imports from Iran.
India’s oil imports from Iran have already dropped by a significant 16 per cent after the US imposed the sanctions. India is currently the second-largest buyer of Iranian oil.
International oil prices have gone up as buyers fear supplies from Iran would come to a halt. Analysts expect a fall in OPEC’s production from 32.1 million barrels per day (bpd) in 2018 to 31.7 million bpd next year.
But the cut in Iran’s oil supplies could result in an increase in supplies from non-OPEC countries over the coming months. A report by BNP Paribas estimates that non-OPEC production could increase by 2 million bpd this year and almost the same quantity in 2019.
