Oil Trade
Iran is taking strategic steps to maintain its crude oil exports amid the escalating military conflict with Israel, according to two leading vessel tracking firms cited by Reuters.
Despite heightened regional tensions and the risk of infrastructure damage, Tehran has kept its vital oil trade flowing—primarily to China—by adapting its logistics and export methods to navigate the increasingly volatile environment.
The ongoing hostilities, which erupted between Iran and Israel last week, have placed a spotlight on Iran’s ability to continue exporting oil while evading U.S. sanctions reinstated in 2018.
Iran heavily relies on a shadow fleet of tankers to discreetly transport crude and mask the oil’s origin. So far, crude oil loadings have remained largely unaffected by the conflict, particularly from Kharg Island, Iran’s main oil export hub.
Recent data from analytics firm Kpler indicates that Iran has been loading approximately 2.2 million barrels of oil per day this week—marking a five-week high in output.
Notably, all loadings have taken place from the eastern jetty of Kharg Island. Analysts believe this shift may be a precautionary move by the National Iranian Oil Company (NIOC) to avoid the more exposed western jetty, which is situated in open waters and could be more vulnerable to missile strikes.
Kharg Island lies around 30 kilometers off Iran’s southwest coast, deep within the Persian Gulf. In the current situation, large tankers are being allowed to approach the island one at a time. Meanwhile, 15 to 16 Iranian oil tankers remain scattered across the Persian Gulf, part of the broader shadow fleet strategy.
Despite U.S. sanctions targeting Chinese buyers since March, Iran has managed to maintain relatively stable oil exports this year, averaging around 1.7 million barrels per day, according to the International Energy Agency.
In another key development, Iran has repositioned a significant portion of its floating oil storage closer to China. Out of 40 million barrels held in floating storage—spread across 36 vessels—approximately 8 million barrels on ten tankers have now been moved from the Singapore area to just offshore China, according to ship-tracking firm Vortexa.
The remaining 20 million barrels still sit near Singapore, while 12 million barrels were in the Persian Gulf at the beginning of June, though their current location remains unconfirmed.
Emma Li, senior China market analyst at Vortexa, explained that the eastward movement of these barrels is a strategic move, even in the absence of firm purchase orders. “Iran has been moving these barrels eastwards to strategically place them closer to the end buyers in a time of heightened geopolitical risk,” she said.
By positioning oil supplies near China, Tehran is attempting to reduce delivery time and offset potential disruptions that could delay shipments by up to two weeks. The move underscores Iran’s resilience and tactical maneuvering in the face of intensifying international pressure and military threats.
