ByCharles Kennedy– Feb 25, 2025, 10:30 AM CST
The growing number of oil tankers sanctioned by the United States is limiting the availability for Iran to ship its crude as Tehran is in more intense competition with Russia and Venezuela for vessels not yet blacklisted by the U.S. Treasury.
“There is only a number of tankers on the market willing to take high-risk sanctioned oil and now Iran needs to compete with Russia and Venezuela to secure them,” Muyu Xu, a senior crude oil analyst at Kpler said at an event, as carried by Bloomberg.
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The stricter sanctions on tankers carrying oil from Russia and Iran since the beginning of the year have created a run on non-sanctioned tankers. Iran is therefore in competition with Russia, and Venezuela to an extent, for securing unsanctioned vessels.
Buyers in Asia, including the biggest Asian oil importers, China and India, prefer to steer clear of tankers sanctioned by the U.S.
About 150 tankers were used to ship Iranian oil last year, but now more than 100 of these have been blacklisted by the U.S., leaving fewer and fewer available vessels for non-sanctioned trade.
Iranian oil exports have dropped since the U.S. began ramping up sanctions on Iran’s oil exports at the end of 2024, even before the inauguration of President Donald Trump, according to Kpler’s estimates.
Oil exports have declined to about 1.5 million barrels per day (bpd), down from 1.76 million bpd in November, before the crackdown started, per Kpler data cited by Bloomberg.
Iranian supply could further drop after the U.S. on Monday imposed additional sanctions aimed at stifling trade via Iran’s shadow fleet, as part of the Trump Administration’s maximum pressure campaign on Iran.
“The United States will use all our available tools to target all aspects of Iran’s oil supply chain, and anyone who deals in Iranian oil exposes themselves to significant sanctions risk,” Secretary of the Treasury Scott Bessent said.
The U.S. Office of Foreign Assets Control also added four Indian companies to its latest list of entities sanctioned for their involvement in the international trade of Iranian crude oil.
By Charles Kennedy for Oilprice.com
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