China remains the only buyer of Iranian oil even at the risk of renewed American sanctions. Recent agreements between the U.S. and Iran may impact global oil prices.
U.S. Treasury Secretary Scott Bessent stated that China continues to purchase oil from Iran, even as other countries avoid such deals due to concerns over new American sanctions. Iranian supplies are made at a discount, which attracts Chinese importers, while potential partners from the U.S. maintain a position of waiting.
After the signing of a memorandum between the U.S. and Iran, there was a decrease in global oil prices. Bessent emphasized that the American administration will continue to monitor the situation in the market. Under the sanctions, the U.S. Treasury’s Office of Foreign Assets Control allowed specific transactions involving Iranian oil to be conducted until the end of summer.
Oil prices are on track for the largest quarterly decline since 2020, when the pandemic affected the global economy. Increased shipping through the Strait of Hormuz indicates a possible easing in the market. However, analysts at Morgan Stanley warn of a potential oversupply, which could impact the overall supply and demand balance.
| Country | Activity |
|---|---|
| China | Purchases oil from Iran |
| Iran | Supplies oil at a discount |
| Other countries | Refrain from purchases due to sanctions |
