The International Energy Agency (IEA) states that recent U.S. sanctions on the “shadow fleet” of Russia and Iran will likely have a “significant” impact on the oil revenues of both countries.
The report adds that approximately one-third, equivalent to 500,000 barrels per day, of Iran’s oil exports in 2024 were carried out using tankers that have recently been added to the U.S. blacklist.
After Iran’s second missile attack on Israel, the United States sanctioned 35 tankers belonging to Tehran’s “shadow fleet.” Last Friday, it also imposed sanctions on more than 160 tankers involved in Russian oil exports, eight of which were also engaged in smuggling Iranian oil.
The “shadow fleet” or “ghost fleet” refers to a network of oil tankers that evade sanctions by turning off their automatic identification systems and falsifying documents to smuggle sanctioned oil. So far, nearly 500 tankers linked to Iran’s shadow fleet have been identified, with half of them already sanctioned.
Iran Races To Sell Its Stranded Oil In China To Strengthen Its Allies
The International Energy Agency states that while the new U.S. sanctions against the “shadow fleet” will significantly impact the oil revenues of Russia and Iran, Russia—unlike Iran—can still export its oil within the framework of existing sanctions.
Under sanctions imposed by the U.S., European Union, and other G7 countries, Russia is only permitted to export oil at prices below $60 per barrel. If it complies with this price cap, it can even use Western companies for shipping and insurance services.
Russia is making every effort to sell its oil at prices above $60 per barrel. However, unlike Russia, U.S. sanctions do not permit the purchase of Iranian oil under any circumstances or at any price. As a result, Iran’s regime relies solely on its “shadow fleet” and rebranding its oil, selling shipments under the names of Malaysian, Singaporean, Iraqi, Emirati, and Omani crude to small independent Chinese refineries known as “teapots.”
The price of Brent crude oil, the international benchmark, is currently above $81 per barrel, an increase of $8 compared to last month.
Meanwhile, the Shandong Port Group in China, which operates the largest oil terminals receiving Iranian crude, recently banned the entry of tankers sanctioned by the U.S. This has made it increasingly difficult to transport sanctioned Iranian oil to China.
Data from the commodities intelligence firm Kpler shows that Iran’s daily oil exports have dropped by around 500,000 barrels in the last two months of 2024 compared to previous months, falling below 1.3 million barrels per day.
This comes as Iran’s budget plan for the next fiscal year, starting on March 21, 2025, sets a target of exporting 1.85 million barrels of oil per day, with one-third of these exports managed by the Islamic Revolutionary Guard Corps (IRGC) and the remainder by the government.
