As the EU ban on insurance of Iran’s oil trade approaches, Chinese refiner Sinopec has refused offers of cut-price Iranian crude oil, saying it will cut imports up to a fifth this year, according to a senior Chinese oil executive.
Despite previously going against sanctions on Tehran, the Chinese government is insisting that relations with the US are more important, as it has made big energy investments in the country. The US had worried that Beijing would not be able to resist bargaining or offers from Tehran.
According to Chinese customs data, China bought 555,000 barrels per day of Iranian oil last year. Sinopec says it will cut 16-20% from imports, amounting to 400,000-420,000 bpd.
According to reports, China is stockpiling to guard against unexpected supply shortages. Other major Asian consumers, however, such as India, Japan and South Korea, are still struggling for a waiver from the sanctions.
Cuts from the four major Asian buyers have cut off an estimated $10 billion in oil revenue to Iran this year alone.