The looming revival of UN sanctions on Iran is unlikely to halt Tehran’s vital crude exports but could hand Chinese refiners a lucrative advantage, giving them greater access to discounted Iranian oil, Reuters reported on Wednesday.
Britain, France and Germany triggered the 30-day “snapback” process on August 28, accusing Iran of breaching the 2015 nuclear deal. If no agreement is reached, restrictions including an arms embargo, asset freezes and bans on nuclear-related technology will return at the end of the month.
The move would also provide a legal basis for the EU and Britain to reimpose banking, shipping and energy curbs.
But as Reuters’ columnist Ron Bousso writes, past experience shows Western sanctions have had limited lasting impact on Iranian oil flows.
Exports collapsed to 444,000 barrels per day (bpd) in 2020 after Washington reimposed sanctions but have since rebounded to 1.6 million bpd this year, with nearly 80% going to China, according to data from analytics firm Kpler.
Despite years of US efforts to expand restrictions on tankers, traders and refiners, Iran has developed an opaque network of intermediaries, uninsured vessels and ship-to-ship transfers to keep crude flowing.
“These whack-a-mole efforts have had little and often short-lived impact,” Bousso wrote.
Analysts say the snapback may deter some Asian buyers but not Beijing, which has already defied Western sanctions by importing sanctioned Russian LNG cargoes. Chinese refiners could even gain leverage to secure Iranian oil at steeper discounts, further undermining the effectiveness of Western sanctions.
The oil and petrochemical sector contributed roughly a quarter of Iran’s GDP in 2024, making continued exports critical to Tehran’s economy as sanctions loom.
