As US sanctions intensify on Iran’s oil exports, smaller and more nimble tankers are increasingly vital in transporting Iranian crude to China. Aframax and Suezmax vessels have emerged as key players, according to ship-tracking data. Eight of these tankers received Iranian oil from supertankers via ship-to-ship transfers in February, with the majority headed for China, a sharp increase from just two such vessels each in December and January.
The rise in the use of smaller vessels marks a significant shift in a trade traditionally dominated by very-large crude carriers (VLCCs), or supertankers. This change is believed to be driven by the smaller ships’ ability to dock at shallower Chinese ports, such as Dongying, which have become crucial points for receiving both Iranian and Russian oil shipments. These ports have become more favorable as larger terminals—often handling containers and bulk cargo—are increasingly wary of potential secondary sanctions.
The Biden administration’s ramping up of US sanctions, alongside former President Donald Trump’s “maximum pressure” campaign, has led to the blacklisting of numerous vessels, including many VLCCs. This has made it harder for the large tankers to navigate the increasingly scrutinized routes, pushing the use of Aframaxes and Suezmaxes, which are smaller in size but still capable of transporting substantial oil volumes.
In response to the tightening restrictions, new strategies have emerged to maintain the flow of Iranian oil to China. Ship-to-ship transfers, especially in Malaysian and Fujairah waters, have become a more frequent practice to disguise the origin of the shipments. Prior to February, these transfers mostly involved supertankers. While VLCCs can carry up to 2 million barrels of oil, Aframax and Suezmax vessels transport between 700,000 to 1 million barrels. However, the need for multiple transfers and smaller ships increases overall transport costs.
In February, sanctioned supertanker Lan Jing (formerly Wen Yao) was involved in transferring Iranian crude to Aframax ships Reston, Brava Lake, and Shun Tai off Malaysia, with shipments bound for Chinese ports including Huangdao, Dongying, and Zhoushan. Additionally, the Iranian VLCC Derya transferred its cargo to the Suezmax Aventus I and Aframax Viola, with deliveries slated for Dongjiakou and Dongying.
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