Crude oil importers are scrambling for a solution to their Iranian problem after earlier this week the U.S. State Department urged all U.S. allies to completely suspend their Iranian imports by November 4—the date when the new sanctions against Iran’s oil industry kick in.
Following the announcement, oil prices jumped, with analysts rushing to revise upwards their estimates of how many Iranian barrels will be lost to the world oil market from November onwards.
However, nothing is certain at this point although the scales are tipped to the U.S.: despite declarations that they will continue importing Iranian oil or actively seek waivers from the sanctions, a number of crude oil buyers from South Korea, India, and Japan have started cutting their shipments from Iran.
Importers are not giving up, though. European countries, India, and even stout U.S. ally Japan are looking for ways to convince Washington they need to continue buying Iranian crude. China, meanwhile, has made it clear it would not heed the U.S. calls for Iranian oil import suspension as has Turkey.
China, however, is better placed to stay true to its word: Asia’s second-biggest economy already found a way to buy Iranian crude when the country was subjected to international sanctions and it will in all likelihood again find a way around the sanctions. China is Iran’s biggest oil client followed by India, South Korea, and Turkey.
Industry observers note that China’s…