International Energy Agency: Significant Impact of New US Sanctions on Iran's Oil Exports

The International Energy Agency states that recent US sanctions on the 'shadow fleet' of Russia and Iran will likely have a 'significant' impact on the oil revenues of both countries. The report adds that about one-third, equivalent to 500,000 barrels per day, of Iran's oil in 2024 will be exported by tankers that have recently been added to the US blacklist. Following Iran's second missile attack on Israel, the United States sanctioned 35 tankers belonging to the Islamic Republic's 'shadow fleet' and last Friday sanctioned over 160 tankers involved in Russian oil exports, eight of which were also engaged in smuggling Iranian oil. The 'shadow fleet' refers to a collection of tankers that smuggle sanctioned oil by turning off their automatic identification systems and falsifying documents. Nearly 500 tankers linked to Iran's 'shadow fleet' have been identified, half of which have been sanctioned. The International Energy Agency notes that while the new US sanctions against the 'shadow fleet' will significantly affect the oil revenues of Russia and Iran, Russia, unlike Iran, can still export its oil within the framework of the sanctions. According to US, EU, and G7 sanctions, Russia is only allowed to export oil at a price below $60, and in this case, it can even use the services of Western companies for shipping and insuring oil shipments. The rental rates for tankers have increased following the new US sanctions against Iran and Russia. Russia is striving to sell its oil above $60, but unlike Russia, US sanctions do not allow the purchase of oil from Iran under any circumstances or at any price. Iran can only sell its oil through the 'shadow fleet' and by rebranding its oil, shipping cargoes under the names of Malaysia, Singapore, Iraq, the UAE, and Oman to small independent Chinese refineries known as 'teapot' refineries. The price of North Sea Brent crude oil is currently above $81, having increased by $8 compared to last month. Meanwhile, the Shandong Ports Group in China, the largest oil terminal receiving Iranian oil, has recently banned the entry of US-sanctioned tankers, making it increasingly difficult to transport sanctioned Iranian oil to China. Data from the commodity information company, Kpler, indicates that Iran's daily oil exports in the last two months of 2024 have fallen by about 500,000 barrels compared to previous months, dropping below 1.3 million barrels. This is while Iran has targeted a daily oil export of 1.85 million barrels in its budget for the next solar year, with one-third to be exported by the Islamic Revolutionary Guard Corps and the rest by the government itself.