Analysts say that the rise in the movement of oil in contravention of western sanctions is often happening with the full knowledge of the US government
According to the EIA the truth is both shockingly brazen and increasingly common; oil originating in countries currently sanctioned by the US and its allies is being systematically relabelled as coming from third-party countries like Malaysia, Oman and the UAE, in order to skirt international embargos., Iran or Venezuela to meeting points in South-east Asia and transferred from tanker to tanker, where it is then relabelled as coming from a nearby oil producer, before it is shipped on to China.
A photo from the Indonesian Maritime Security Agency shows an Iranian-flagged vessel conducting a suspected illegal transfer of oil in the waters of Indonesia’s exclusive economic zone.Despite such efforts, the trade in sanctioned oil from countries like Russia and Iran has boomed over the last year., according to watchdog group United Against a Nuclear Iran . The group estimate that 91% of that oil was imported by China.
In January, the Biden administration’s then special envoy for Iran, Robert Malley, told Bloomberg that the US was not OK with Iran’s increasing oil exports and that they would do “everything in our power” to enforce sanctions. “Oil is a very touchy issue in US politics,” O’Donnell says. “If the price of gasoline goes up, everyone points at the president … This will be used by the GOP to say Biden is screwing up.”In December 2022, the G7, the European Union and Australia agreed to a price cap on Russian oil in response to its invasion of Ukraine. Under the terms of the deal, insurers are prohibited from covering vessels which sell oil above the maximum price set by those western powers.
“In some ways, [sanctions] have been beneficial to China,” says O’Donnell. “They can play countries off each other and get the best deal.”The growing fleet of shadow tankers are transporting sanctioned oil with little regard for industry regulations. Performing dangerous mid-ocean transfers of oil in order to hide their sanctioned cargo, an increasing number are also now operating without insurance in order to circumvent the oil price cap imposed on Russia.
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