Iran's energy exports plummet as Russia boosts oil and gas supplies to China

Iran's energy exports plummet as Russia boosts oil and gas supplies to China
It comes as Russia boosted trade with countries like China – a key destination for Iranian oil – amid heavy western sanctions.
3 min read
13 June, 2022
China is a key destination for Iranian oil [JAMSHID BAIRAMI/AFP via Getty Images-file photo]

Iran reportedly exported less than half as much oil and natural-gas condensate in May as it did in April, indicating Russia is cutting out Tehran's trading opportunities by boosting its own oil sales to China.

Tehran shipped about 400,000 barrels per day (bpd) last month, mostly to countries in Asia, commodity data company Kpler said, according to US government-backed broadcaster Radio Farda on Monday.

This is a sharp decline from about 820,000 bpd in April, which is in turn less than the 908,000 bpd sent the month prior.

It comes as the west imposes heavy sanctions on Russia's economy in response to Moscow's brutal war on Ukraine. With Europe and other countries turning to alternative supplies, it has prompted Moscow to boost trade with countries such as China.

The country is also a key destination for Iranian oil.

Beijing increased its imports of Russian oil to 1.1 million bpd last month, a more than 30 percent increase on the 750,000 bpd it took in the first quarter of 2022, Vortexa Analytics estimated.

Arash Azizi, a historian and author of The Shadow Commander: Soleimani, the US and Iran's Global Ambitions, said Tehran's segment of the oil trade with China and other nations was "already meagre" but Moscow's push for new trading opportunities reduces it further.

He added that Russia absorbing much of this "confirms what critics of the Iranian regime's unequal relationship with Moscow have long said: with its over-reliance on Russia, Iran threatens itself and undermines its own interest".

"Amidst US-led global sanctions, Iran's relationship with Russia and China is not based on an alliance of mutual interests but one of desperation on the part of Iran," Azizi told The New Arab.

"As a result, Moscow and Beijing abuse Iran's isolation by using it for cheap oil while Iran's options remain limited."

He added that Iran must emerge from its isolation and forge ties with all parties as it cannot build strong international trade by depending on China and Russia.

US sanctions on Tehran increased dramatically after then-President Donald Trump pulled Washington out of the Iran nuclear deal in 2018.

The pact had seen most sanctions on Iran lifted in return for limits on the Islamic republic's nuclear activities.

The next year, Washington implemented a global ban on purchases of Iranian oil, and shipments plummeted to about 250,000 bpd, London-based broadcaster Iran International reported.

The Islamic Republic had been exporting over 2.5 million bpd in 2017, according to the US Energy Information Administration.