Data from Kpler, a global shipping-analytics firm, shows that the volume of Iranian crude stored on floating tankers has reached 52 million barrels, the highest level in two and a half years, indicating falling demand from its main buyer, China.
According to Bloomberg, nearly half of this oil is located near Malaysia.
The report, published on Tuesday, November 25, stated that this amount is nearly twice the volume stored one month ago and far above the five to 10 million barrels stored on floating tankers in January.
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The buildup of cargoes has increased the discounts on grades such as Iran’s light crude.
Traders familiar with the market—who requested anonymity due to the sensitivity of the dealings—have said that the discount has reached as much as eight dollars below Brent crude, whereas three months earlier it had been about four dollars.
On September 17, Reuters reported—citing six commercial sources—that the Iranian regime has been selling oil to small Chinese refineries (known as “teapots”) at deeper discounts. Iran’s stored oil volumes in China have reached a new record, while end-of-year import-quota restrictions have increased, prompting the regime to offer even steeper discounts.
According to that report, the discount on Iran’s light crude for October cargoes exceeded six dollars per barrel relative to Brent. Two weeks earlier it had been around five dollars, and in March roughly three dollars.
OilPrice.com also reported on August 9 that despite the tempting discounts, Chinese buyers were not purchasing Iran’s oil, leaving more than 30 million barrels stranded near Malaysia.
Despite sanctions, until the start of Donald Trump’s second presidential term in January 2025, some small Chinese “teapot” refineries continued buying Iranian oil because of the regime’s extremely high discounts. But once Trump took office, this pattern gradually became disrupted.
According to Kpler data from that period, Iran’s floating crude inventories rose from nine million barrels in mid-January to 33.4 million barrels in early August.
Most of these stranded tankers are anchored in the waters of Singapore and Malaysia—key hubs for Iran’s ship-to-ship transfer operations—and storing such large volumes at sea imposes heavy costs on the Iranian regime.
Additionally, following the twelve-day conflict, Iran’s regime, fearing strikes on its onshore oil storage facilities, has moved a large portion of its stored oil onto tankers.
Chinese “teapots”
Under sanctions, the main buyers of the Iranian regime’s oil were China’s small independent refineries, known as “teapots.”
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From the outset of his term, the Trump administration imposed unusually strict pressure on buyers of the regime’s oil.
Malaysia has also come under U.S. pressure to crack down on the accumulation of Iranian oil in its waters.
