China buys Iranian oil at premiums to Brent

SINGAPORE:

Chinese independent refiners have bought Iranian oil at premiums to Brent for the first time in years, after benchmark prices fell and amid expectations that India might purchase more cargoes after Washington's temporary waiver of sanctions.

India is set to get its first Iranian oil cargo in seven years after Washington temporarily waived sanctions on Iranian oil at sea due to the impact of the conflict in the Middle East.

Iranian oil typically trades at discounts to Brent because of the sanctions. Chinese independent refiners, also known as teapots, are its biggest buyers.

At least two refiners in Dongying, a major hub for independents in the eastern Shandong province, purchased Iranian Light at premiums of $1.50 to $2 a barrel to ICE Brent earlier this week, trade sources said. That compared with a $10 per barrel discount before the conflict.

The cargoes are floating near China and will be delivered this month, the people said.

One of the people said he believed it was the first time since 2022 that teapots have bought Iranian oil at a premium to Brent.