Yes, China continues to be the largest buyer of oil from Iran in 2025, despite the presence of renewed international sanctions. A clandestine system allows this trade to continue, bypassing U.S. and other international financial restrictions.
How the trade operates
Barter system: Reports from early October 2025 indicate that the trade functions as a barter system. Chinese state-backed companies build infrastructure projects in Iran in exchange for oil, avoiding international banking systems where sanctions would apply.
"Dark fleet" shipping: To conceal the origin of the oil, a "dark fleet" of tankers is used. The vessels transfer oil from ship to ship, often off the coast of Malaysia, and use other deceptive practices to evade detection. This leads to Iranian oil being re-labeled as coming from other countries, such as Malaysia.
Secretive
financial channels: The financing for the infrastructure projects
is funneled through secretive Chinese financial entities and underwritten by a
state-owned insurance company, further concealing the transactions.
Sanctions and evasion efforts
Continued
sanctions: The trade persists despite repeated efforts by the United
States to target Iranian oil networks. In late September and early October
2025, international sanctions on Iran were even expanded, including a
"snapback" of UN sanctions.
Minimal impact: The effectiveness of these sanctions has been limited. The Foundation for Defense of Democracies reported in August 2025 that the Trump administration's efforts to reduce Iranian oil exports have so far not significantly decreased the volume of oil being sold.
Chinese "teapot" refineries: A primary customer for this discounted Iranian crude is China's independent "teapot" refineries. These smaller, privately owned refineries primarily located in Shandong province have a higher risk tolerance and depend on cheap, discounted crude.
Trade volume
and discounts
Majority of
exports to China: In 2025, an estimated 90% or more of Iran's oil exports
have gone to China.
Record
export levels: By July 2025, Iran's exports of oil and related products
had reached roughly 1.8 million barrels per day, with most of it bound for
China.
Significant discounts: The oil is sold at a steep discount to international market rates, making it an attractive and affordable source for Chinese buyers.
Yes, China buys significant amounts of oil from Iran in 2025, continuing its position as Iran's largest customer despite U.S. sanctions. However, this trade is conducted largely through covert and non-transparent mechanisms to avoid international financial systems.
Evasion
tactics and trade structure
To
circumvent sanctions and mask the oil's origin, China and Iran use several
clandestine methods:
· "Dark fleet"
shipping: Iran employs a network of aging vessels that disguise their
movements and origin. They often conduct ship-to-ship transfers at sea and
relabel Iranian crude as coming from other countries, notably Malaysia.
· Hidden barter system: Iranian oil
is exchanged for Chinese-built infrastructure projects and other goods. A
hidden financial conduit, which Western officials say involves the Chinese
state insurance company Sinosure and a secretive financial entity, facilitates
the payments outside of the international banking system.
· Falsified customs data: Because of these tactics, Chinese customs data does not reflect direct oil imports from Iran, while imports from countries like Malaysia have surged far beyond their actual production capacity.
Who is
buying the oil?
· Independent refiners: The primary
buyers of Iranian crude in China are independent "teapot" refineries,
located mainly in Shandong province.
· Strategic discount: These
refineries are motivated by the deep discounts Iran offers on its oil, which is
significantly cheaper than non-sanctioned crude.
· Official silence: Large state-owned Chinese oil companies have largely avoided purchasing Iranian oil since 2018–2019 to minimize sanctions risk.
Volume and
scale of the trade
· Large share of Iran's
exports: Approximately 90% of Iran's total oil exports are sold to China.
· Significant volume: In the first
half of 2025, China's imports of Iranian crude and condensate averaged about
1.4 million barrels per day, according to Kpler data.
· Reliance on China: The trade creates a heavy dependency for Iran, limiting its buyers and reducing its profit margins due to the discounts offered.
Diplomatic
posture
· Political backing: China continues
to provide political support for Iran and has deemed U.S. sanctions
illegitimate under international law.
· Strained U.S. relations: The continued trade remains a point of tension with the United States, which has reimposed and tightened sanctions on Iran in 2025.
https://www.google.com/search?q=does+china+buy+oil+from+iran+2025
Norb Leahy,
Dunwoody Ga Tea Party Leader
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