Shandong Port Group Banned US-Sanctioned Tankers from Its Ports
Shandong Port Group, a major port operator in eastern China, has banned US-sanctioned tankers from calling into its ports, three traders said. The move is likely to drive up shipping costs for independent refiners in the region, which are the main buyers of discounted crude from countries under US embargo.
Shandong’s Port Ban
The ban, which took effect on January 6, prohibits ports under Shandong Port Group’s management from docking, unloading, or providing ship services to vessels on the Office of Foreign Assets Control (OFAC) list, managed by the US Department of the Treasury. The group oversees major ports on China’s east coast, including Qingdao, Rizhao, and Yantai, which are major terminals for importing oil from countries under US embargo.
Impact on Independent Refiners
The ban is likely to have a limited impact on independent refiners in Shandong, as most of the sanctioned oil is carried on non-sanctioned tankers, according to a notice issued by Shandong Port Group. However, the ban could still drive up shipping costs for these refiners, which have been struggling with poor margins and sluggish demand.
Shandong’s Oil Imports
Shandong province imported about 1.74 million barrels per day (bpd) of oil from Iran, Russia, and Venezuela last year, accounting for about 17% of China’s imports, according to Kpler’s ship tracking data.
US Sanctions
The US has imposed further sanctions on companies and the shadow fleet that deal with Iranian oil. President-elect Donald Trump, who takes office on January 20, is expected to tighten sanctions further on Iran, as he did during his first administration.
Global Impact
The ban could slow imports into China, the world’s largest oil importing nation, traders said. The US Defense Department has also added China’s largest shipping company Cosco to a list of companies it said work with China’s military, which could deter use of Cosco’s tankers by charterers and add to tightness of ships for hire.
Conclusion
The ban by Shandong Port Group on US-sanctioned tankers is likely to have a limited impact on independent refiners in the region, but could still drive up shipping costs. The US sanctions on companies and the shadow fleet that deal with Iranian oil are expected to tighten further, which could slow imports into China and impact global oil prices.
Frequently Asked Questions
Q: What is the purpose of Shandong Port Group’s ban on US-sanctioned tankers?
A: The ban is designed to comply with US sanctions on companies and individuals dealing with Iranian, Russian, and Venezuelan oil.
Q: How will the ban impact independent refiners in Shandong?
A: The ban is likely to have a limited impact, as most of the sanctioned oil is carried on non-sanctioned tankers. However, the ban could still drive up shipping costs for these refiners.
Q: What is the significance of Shandong province’s oil imports?
A: Shandong province imported about 1.74 million barrels per day (bpd) of oil from Iran, Russia, and Venezuela last year, accounting for about 17% of China’s imports.
Q: What are the implications of the US sanctions on companies and the shadow fleet that deal with Iranian oil?
A: The sanctions are expected to tighten further, which could slow imports into China and impact global oil prices.
