Chinese refiners pay more for Iranian oil: Report
China’s small, private refiners are paying up for Iranian oil due to reduced flows and few offers, Bloomberg wrote.
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, which has been discounted because of US-led sanctions. Larger government-linked processors tend to avoid the fuel because of fears of economic repercussions.
While 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.