Energy Trade Routes Shift as Washington Tightens Sanctions on China

The ongoing tensions between Washington and China regarding secondary sanctions on Chinese entities tied to Iran have led to a significant shift in energy trade routes. Middle East supply routes are facing renewed pressure, causing companies with refining or LNG infrastructure outside of China to reassess their business strategies.

Tidewater Midstream and Infrastructure (TSX:TWM) is one such company that could benefit from this change. The Canadian midstream and refining asset owner has been expanding its operations in renewable fuels and low-carbon credits, but it still faces execution risk, earnings volatility, and operational setbacks.

Another company to watch is World Kinect (WKC), an energy management and fuel logistics firm that provides direct exposure to global fuel flows. With a market cap of around US$1.8 billion, WKC offers a mix of risk and resilience, making it an attractive option for investors seeking companies that could benefit from disorder in energy trade.

Imperial Petroleum (IMPP) is also worth considering. The Greece-based shipowner generates revenue from transportation shipping services, primarily moving crude oil and refined products worldwide. With a 21-vessel fleet serving oil producers, refineries, and commodity traders, IMPP provides exposure to the seaborne side of this theme.