Chinese refineries pay more for Iranian oil

China’s small, private refiners are paying up for Iranian oil.

News ID: 5464

Date: 24 November 2024 - 08:21

TABNAK, Nov, 24 : The so-called teapots bought Iranian Light crude for December arrival at a discount of $2 to $3 a barrel against the ICE Brent benchmark, the smallest gap this year, according to market participants.

Traders said they’ve seen fewer cargo offers over the past weeks, while there have also been talks of cargo delays that have crimped Iran-to-China volumes in recent months.

Teapots account for about a quarter of China’s crude processing and are the main buyers of Iranian crude.

Chinese refinery import quotas for this year are also running low, the teapots will be allowed to use some of their allocations for 2025 as part of efforts by local governments to hit performance indicators, the traders said, adding that about a dozen have applied to bring in crude using the system.

Chinese refiners remain “laser-focused” on securing Iranian supplies despite tightening sanctions and US increasing pressure on Iran, Kpler said in a note to clients.

The data intelligence firm sees Iranian crude oil exports declining by 54,000 barrels a day to 1.43 million barrels a day in November because of domestic demand for electricity generation during a severe natural gas shortage.

Bloomberg