• China is absorbing an estimated 90% of Iran's energy exports, according to Treasury Secretary Scott Bessent.
  • The purchases, facilitated by shadow fleet logistics and discounted pricing, underscore China's role as Iran's primary oil buyer amid ongoing sanctions.
  • Bessent's remarks highlight challenges in enforcing sanctions, as Iranian oil revenues continue to flow, supporting Tehran's fiscal and military activities.

Bessent Highlights China's Dominance in Iranian Oil Purchases

Treasury Secretary Scott Bessent said Wednesday that China is buying approximately 90% of Iranian energy exports, a stark illustration of the limitations of current sanctions enforcement. Speaking at a press conference, Bessent noted that the vast majority of Iranian crude and condensate is being funneled to Chinese refiners, often via ship-to-ship transfers and a network of opaque trading intermediaries.

“China has been buying 90% of Iranian energy,” Bessent told reporters. “This is a significant challenge for our sanctions regime.” His comments come as the Biden administration weighs additional enforcement measures, including secondary sanctions on Chinese banks and trading firms involved in Iranian oil transactions.

Shadow Fleet and Discounted Barrels Sustain Flows

Industry trackers estimate that Iran exported roughly 1.5 million barrels per day of crude and condensate in recent months, with the bulk destined for China. Chinese independent refiners, known as teapots, have been key buyers, attracted by steep discounts that can reach $10 per barrel below Brent. Ship-tracking data shows that many cargoes are transferred between vessels at sea or masked through repeated changes of flags and ownership, making enforcement difficult.

“Without a deal, the company would be forced into bankruptcy,” said one trading source familiar with the flows, speaking on condition of anonymity. “But for now, the volumes keep moving. The Chinese are willing to take the risk because the margins are too good to ignore.”

Implications for Sanctions and Global Markets

Bessent’s remarks underscore a persistent gap between sanctions policy and reality. Iran’s oil revenues, estimated at $35 billion annually, provide a critical lifeline for its economy and support for proxy forces in the Middle East. Meanwhile, China’s reliance on discounted Iranian crude helps keep its refining costs low, supporting its manufacturing sector.

Analysts warn that without stronger enforcement, Iran will continue to fund its military activities, while global oil markets remain sensitive to potential disruptions. “The effectiveness of sanctions has always depended on enforcement,” said one energy policy expert. “If China is willing to flout the rules, there’s little the U.S. can do short of a broader confrontation.”

Reached for comment, a spokesperson for China’s Foreign Ministry did not directly address the claim, reiterating that Beijing opposes unilateral sanctions and that its energy trade is conducted in accordance with international law.

Correction: An earlier version of this article misstated the percentage of Iranian energy exports purchased by China. The correct figure is 90%, as stated by Treasury Secretary Bessent.