Iran uneasy over $1.75 billion worth of fuel stuck in China
Last Updated on January 10, 2025 6:07 am
China has been holding 25 million barrels of Iranian crude oil for six years. The country is now trying to recover the oil. The oil is stuck in Chinese ports due to the sanctions imposed by newly elected US President Donald Trump during his first term. According to Reuters news agency.
It is believed that Trump will tighten sanctions on Iranian oil exports after taking office on January 20. As in his previous term, this time too, Trump’s goal is to limit Tehran’s income.
The oil stuck in Chinese ports is worth $1.75 billion at current market prices. But even selling this oil to China has now become a challenge for Iran.
It is known that in October 2018, Iran’s National Oil Company NIOC supplied this oil to Chinese ports. At that time, Trump gave a special discount under which the oil was exported. NIOC stored the oil in the ports of Dalian and Zhoushan in eastern China. The two ports had oil tanks rented by the Iranian company. NIOC, which has leased oil tanks, could sell oil to China at will or ship it to other buyers in the region as needed.
But Trump withdrew the waiver in 2019. That’s when Iran found itself in trouble. No buyer could be found for the oil stored in China, nor could China’s customs approve its release. As a result, the oil was stuck in the tank, sources said.
The Dalian oil tank is operated by PDA Energy. It has been demanding $450 million in rent since 2018. On the other hand, the Zhushan tank is operated by CGPC.
Iranian officials and the Chinese tank operator have held emergency meetings over rent payments, as Tehran fears that Trump will tighten sanctions again as president. Iranian Foreign Minister Abbas Araghchi visited Beijing in December and made some progress on the issue, sources said. However, no details were available.
If Iran wants to sell this oil, it will have to be taken out of the tanks, loaded onto a ship, and then transferred to another ship at sea. Then new documents will have to be prepared for the oil, an Iranian source said.