Iran expands oil operations in China despite US sanctions, confidential letter shows
Iran has secured control of oil terminals and storage facilities at several locations in China to help transport and sell its sanctioned crude despite US restrictions, according to a confidential letter obtained by Iran International and accounts from sources in Iran’s Oil Ministry. In a confidential letter written by Hamid Bovard, former head of the National Iranian Oil Company (NIOC) and current acting oil minister, in response to correspondence from Ali Shamkhani, a former secretary of Iran’s Supreme National Security Council and political adviser to then-supreme leader Ali Khamenei.
The latest disclosures follow an earlier Iran International report in September, which said that Mohammad Javad Bavand, a special assistant to the oil minister, had instructed four intermediaries, including Hossein Shamkhani, to sell 86 million barrels of Iranian crude at an 8.5% discount.
Iranian authorities instructed trusted oil intermediaries to continue using sanctioned vessels capable of docking at designated Chinese ports, according to Bovard. Two Iranian oil ministry sources told Iran International that Tehran had acquired control of facilities at three locations in China. Iran has also purchased seven oil storage tanks in China, according to the report.
In his letter, Bovard criticised the oil-trading policies of former president Ebrahim Raisi and described an alternative arrangement developed under President Masoud Pezeshkian, involving what he characterised as covert cooperation from China. The Iranian foreign ministry negotiated access to port facilities and oil terminals, while Tehran secured long-term leases on storage infrastructure to facilitate the direct sale of Iranian crude in the Chinese market. These include a terminal in the Ningbo-Zhoushan free trade zone, where Iran reportedly gained control after helping build smaller transit facilities, as well as stakes in smaller docks at Qingdao and Pant in Shandong province. Four are located at the ports of Dalian and Huizhou and in the coastal cities of Dongying and Weifang. The oil ministry controls three others in the Zhoushan area of the Ningbo-Zhoushan archipelago, including facilities on Aoshan and Shulanghu islands and in the Zengyamuo oil zone.