Iranian Oil Replaces Venezuela in China

Independent refineries in China are expected to turn to heavy crude from sources including Iran in the coming months to replace Venezuelan oil shipments that have been halted by the United States.

According to Reuters, Caracas and Washington have agreed to export up to $2 billion worth of Venezuelan crude to the United States.

Analysts say this agreement will likely reduce Venezuela’s oil supply to China and limit sources of crude for independent refineries. As the world’s largest crude importer, China is a major buyer of oil from Russia, Iran, and Venezuela.

According to analysts, Venezuelan oil on ships in Asia is still sufficient to cover about 75 days of China’s demand, and refineries in China that use Venezuelan oil are expected to turn to supplies from Russia and Iran in March and April. China can also access non-sanctioned sources such as Canada, Brazil, Iraq, and Colombia.

Industry sources said buyers have not yet seriously looked for alternatives, while Iranian heavy crude is considered a suitable and cost-effective option./Tasnim