Iranian Floating Oil Outside Blockade Zone Falls to Zero as Shipments to China Stall
Key Facts
Iranian oil afloat outside the blockade zone fell to zero in mid-October, down from a peak of 88.8 million barrels on July 14, according to Kpler estimates. The company said about 43 million barrels remained trapped inside the blockade zone. The figures point to a shrinking stock available for transport after tankers were unable to leave the area. Kpler said Iran had not loaded a cargo of crude oil or condensate since August 25. Tankers that loaded from mid-July onward were also unable to cross the blockade line, the company said.
Offers of Iranian oil cargoes bound for China for September and October delivery declined compared with July and August cargoes, according to sources cited by Reuters. The agency said barrels already on ships were being sold, while new offers fell. Kpler estimates cited by Reuters show China’s imports of Iranian oil declining to 785,000 barrels per day in June, before rising to 823,000 in July. Imports then fell to 534,000 barrels per day through the time of the report in August. China’s average purchases of Iranian oil were 1.4 million barrels per day in 2025, according to the same estimates.
The supply contraction is hitting China’s independent refineries, known as “teapots,” which are among the largest buyers of sanctioned oil. Reuters said the refineries in Shandong account for about one-fifth of China’s refining capacity, making Iranian crude an important source for them. The U.S. Treasury Department estimated in April that China buys about 90% of Iran’s oil exports and that teapot refineries account for most of those imports. In October, Iran Open Data, citing Kpler data, reported that Iranian oil cargoes stopped loading in mid-August. It added that about 15 million barrels stored off the Chinese coast had been unloaded in the preceding weeks, and no floating inventories remained available there as of October 12.
Iran’s exports to China fell by about half in the three months before Iran Open Data’s report, published on October 12. By contrast, China’s total merchandise imports rose 41.6% year over year in October, according to trade data released on November 10 and cited by the Associated Press. The agency said a recovery in crude shipments from the Persian Gulf contributed in part to the increase in imports. The 41.6% figure does not measure imports of Iranian oil; it refers to China’s total merchandise imports. The data place China’s trade recovery in a broader context without providing evidence that Iranian crude flows to China have resumed.
Shipping restrictions have financial significance for Iran: Kpler estimated that oil sales account for about 30–40% of government revenue and that oil is the country’s largest source of foreign currency. The company said Chinese buyers typically pay one to two months after cargoes are unloaded. On that basis, Kpler forecast that Iran’s revenue from crude and condensate would reach zero by mid-December, if the associated funds could be repatriated. The company also recorded the rial falling to about 272,000 per dollar on the open market on October 22, compared with 157,000 in mid-June. It said the currency had lost about 42% of its value over that period.
In oil markets, Reuters cited a source as saying some Iranian crude was offered at a premium of about $2 a barrel to Brent futures in August. Iranian Light crude had been offered at a discount of about $3 a barrel earlier in the same week. Kpler said Asian refiners were competing for prompt Middle Eastern crude after Iranian barrels disappeared from the market. The company’s assessment leaned toward higher Brent prices in the near term, while Dubai’s price structure could face downward pressure if transit through Hormuz remained elevated. The Associated Press also reported that U.S. forces disabled a St. Kitts-flagged vessel after it ignored warnings and tried to leave the area following a visit to an Iranian port, while October saw the highest number of attacks on commercial ships in Hormuz since March.