US Sanctions Threaten China's Iranian Oil Lifeline

US sanctions on Iran's oil exports have put China's largest buyer of Iranian crude in the spotlight. According to Kpler ship-tracking data, Chinese imports of Iranian crude slipped from 1.57m barrels a day in February to 1.47m barrels a day in March.

The US has warned other countries that they will need to sever business ties with Iran or risk being forced out of the dollar-based financial system.

Treasury secretary Scott Bessent warned Chinese banks they could face secondary sanctions if Iranian funds were found moving through their systems, but stopped short of designating them as such.

Chinese independent refiners have been the main buyers of Iranian crude oil, attracted by a steep discount to mainstream barrels. However, big state refiners have shunned Iranian oil since 2019 due to US sanctions.