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Chinese Customs Data to Remain Errant

Jun 28, 2018 1:49:08 PM EST

As the U.S. Administration requests its allies to stop purchasing Iranian crude, China may inadvertently be helping out Iran as it has halted the publication of its detailed customs data

The reason for the abrupt end to this monthly data release is still not entirely clear. Whether it relates to a system change, or the result of a spat between Chinese authorities and customs over the trade data being sold to third parties, all we know is that Chinese trade data has not been released for April or May. And via our sources, we believe it may be errant for at least another month.

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The absence of this information make tanker-tracking and hard data all the more valuable. We can see from our ClipperData that Iranian flows to China - of which 92 percent is based on Port Agent information - that deliveries are at ~650,000 bpd so far this year - accounting for about 25 percent of total Iranian crude and condensate exports.

While Iranian volumes to China have been on the rise since sanctions were lifted in early 2016, the share of total Iranian exports has dropped 13 percent in recent years to 24 percent, as Iran has diversified its customer base:

Iran crude and condensate exports into China ClipperData-2

All else being equal, we should expect China's share of Iranian exports to rise once again as U.S. sanctions start to impact flows to other areas such as Europe. 

But the U.S. Administration is putting extreme pressure on its allies such as India, China and Japan to halt Iranian exports. The U.S. Secretary of State Mike Pompeo has said that China and India 'will be subject to the same sanctions that everybody else is if they engage in those sectors of the economy.'

China is the largest buyer of Iranian crude, ahead of India and South Korea. Iranian crude flows are going to be increasingly scrutinized as we approach the November 4th deadline - and the absence of Chinese customs data will only further muddy the waters. We at the good ship Clipper will be avidly watching developments. 

About the Author

Matt Smith

deciphers and distills what is most relevant across the energy complex into cohesive and pithy knowledge you can use. The belly laugh is a bonus.

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