Iran shipped 70 million barrels of oil to Asia during monthlong truce window

Iran took advantage of the roughly one-month period between mid-June and mid-July when the U.S. lifted its blockade on Iranian oil to ship out roughly 70 million barrels of crude, worth a total of $5 billion to $6 billion, according to independent estimates by United Against Nuclear Iran and oil analysts cited by The Wall Street Journal. The surge gives the Iranian government a financial buffer now that the U.S. has reimposed its blockade of the Strait of Hormuz and choked Iranian exports once again.

After the U.S. and Iran signed a temporary agreement on June 17 that withdrew the blockade, tankers laden with oil in Iran’s eastern Chabahar port quickly sailed toward Asia. In the second half of June, Iran exported about 50 million barrels of oil bound for eventual sale in China, roughly equal to a month of China-bound exports of Iranian oil before the war, according to United Against Nuclear Iran.

The tankers — including the Diona, the Hero II, the Sonia 1 and the Stream — arrived in waters off the east coast of Malaysia, in an area known as the Eastern Outer Port Limits, outside the country’s territorial waters, vessel-tracking data and analysts cited by the Journal showed. There, crews used giant hoses to transfer the oil at sea to other vessels. The tankers receiving the oil then typically head toward private refineries in China known as teapot refineries, which buy the oil at a discount, analysts said. The method of obscuring the oil’s origin complicates U.S. enforcement efforts, according to analysts.

“If they had left the blockade on, the pinch would likely have hit about now,” said Charlie Brown, a Singapore-based analyst with United Against Nuclear Iran. But once the blockade lifted, Iran “quickly surged more oil…so there is a big buffer again.”

“Iran’s economy is in its worst shape since the revolution, so every dollar of revenue matters,” said Jonathan Panikoff, a Middle East expert at the Atlantic Council. “The regime is likely to prioritize revenue for their own strategic purposes — chief among them right now is fighting the U.S.”