US maritime blockade reduces Iranian oil supplies to China

Iranian oil supplies to Chinese buyers have decreased significantly following a maritime and port blockade imposed by the United States on July 13, 2026. The blockade, implemented after the failure of a peace agreement between the two nations, has impacted Tehran’s primary source of foreign currency.

The reduction in available vessels for September and October deliveries has caused a shift in market pricing. While light Iranian crude was previously offered at a discount of approximately $3 per barrel, it has recently traded at a premium of $2 per barrel compared to ICE Brent futures contracts. Floating stocks of Iranian crude outside the American blockade have dropped from 105 million to approximately 80 million barrels, with only about 30 million barrels remaining in Asian waters. No Iranian supertankers have crossed the Strait of Hormuz since mid-July.

Chinese independent refineries, often referred to as ‘teapots’ in Shandong province, are facing imminent deficits. To compensate, some Chinese buyers are pivoting toward Lapa crude from Brazil and Basrah crude from Iraq. Chinese imports of Iranian oil fell to 534,000 barrels per day in August, down from a previous average of 1.4 million barrels per day.