The Chinese government appears to have been left in the dark about Shandong Port Group (SPG)’s move to ban US-sanctioned tankers from unloading at its terminals.
A spokesperson told reporters at a press conference: “As a matter of principle, I am not aware of the relevant situation,” according to Reuters.
The spokesperson added: “China has always firmly opposed the lack of international law on the part of the US, illegal unilateral sanctions and long-arm jurisdiction without UN Security Council authorisation.”
Notices from the port group obtained by traders and seen by Reuters forbid its staff from berthing, unloading or providing services to ships on the US sanctions list.
SPG runs key ports on China’s east coast, including Qingdao, Rizhao and Yantai, which are critical terminals for importing sanctioned oil.
UK shipbroker Braemar expects the decision will support compliant tankers.
However, the London shop said details of when the ban will come into effect were not released.
About 62% of China’s crude imports from Iran, Russia and Venezuela last year came through ports in Shandong.
Braemar said that of the 183 different tankers arriving in the province with Iranian, Russian, or Venezuelan crude oil or condensate, 63 were under sanctions.
“We expect the move to reduce Chinese imports of Iranian crude, which have already declined since October as the US tightened sanctions,” Braemar said.
“Iranian crude will be replaced by barrels from elsewhere, to the benefit of compliant tankers. That includes from other Middle East Gulf suppliers, as well as countries in the Atlantic basin, such as Brazil, where production is expected to expand next year,” the company said.
More independent Chinese refineries were enquiring this week about West African crude, the brokerage added.
“Buyers in Shandong with cargoes on sanctioned ships will now need to find compliant tankers to unload the cargoes onto or find other ports at which to discharge,” Braemar explained.
“Such increased inefficiencies are likely to raise the cost of Iranian crude relative to other grades, piling pressure on a refining sector grappling with weak fuel demand and tight margins, with independent plants likely to be hit especially hard,” it added.
