This has been evident, regarding Iran, since day one – it explains some of the tensions between Rouhani supporters and Russian patriots over certain sensitive subjects. The so-called ‘hardliner’ Iranians such as Ahmadinejad were better liked by Iran’s poor as well as Russian patriots. That said, Iran’s leadership is up to Iranians. But it’s been the more cosmopolitan elite of Iran that has sought to reap the benefits of European energy market integration. Rouhani, at the same time, was necessary in bringing the Green Movement to heel. – J. Flores
MOSCOW – The US-imposed sanctions on Venezuela and Iran forced European refineries to replace the oil of those countries with the Ural brand.
Although US oil production is on the rise, its crude oil can not be an alternative to that extracted in Venezuela and Iran, as it is lighter and softer, according to Reuters.
As a result, European refineries began competing to secure Russia’s supply of the Urals brand, which helped raise its price to levels not seen since 2013.
Urals is at an advantage over Brent and there is no indication that its price will decline soon, a source in the European oil industry told Reuters.
Rising demand has allowed Russia to receive additional revenue of $140 million.
The STAR refinery, with a production capacity of 200,000 barrels per day, which Azerbaijan built in Turkey, wants to take on the role of a new heavy oil supplier.
It is expected that the launch of STAR has a serious impact on the oil market, but it was not known that the shortage of heavy oil would be so great… refineries are lining up to buy heavy oil, a trader told Reuters.
Another unidentified interlocutor from the agency noted that all refineries want to buy Urals, or look for alternatives, since what is available today on the market does not serve everyone.
Meanwhile, from January to March, Chinese oil imports from Iran and Venezuela increased considerably. Experts believe that China is trying to help its partners in the context of US sanctions, but there is yet another reason.
In the first quarter of 2019, the volume of oil transported from Iran to China in oil tankers increased 78% – from 431,100 to 767,200 barrels per day. From Venezuela the volume grew even more, 193% – from 84,200 to 246,800 barrels per day, according to the TankerTrackers portal.
According to Russian analysts, China’s active buying of Venezuelan and Iranian oil is linked to Beijing’s desire to support its partners in the context of US pressure.
In total, the US blocked assets of Venezuelan state-owned PDVSA from the sale of oil, worth $7 billion. By the end of 2019, Venezuelan oil company losses will be around $11 billion.
Currently, China is Venezuela’s largest lender, explains the specialist in oriental studies Alexei Maslov. Thus, in the context of the economic and political crisis in Venezuela, Beijing is protecting its financial investments with the help of large-scale oil purchases.
According to the Venezuelan consultant Ecoanalítica, in January Venezuela’s national debt to China was about $ 21 billion. At the same time, as Natalia Milchakova of the Russian analytical center Alpari noted in an interview with RT, according to several sources, China’s total investment in Venezuela ranges from 50 to 70 billion dollars.
According to Milchakova, at this time Beijing is also seriously concerned about the protection of its interests in Iran.
In November 2018, US sanctions came into effect. However, the White House gave an additional 180 days to some large importers. Thus, until May 5, 2019, China, Japan, South Korea, India, Greece, Italy and Turkey can still buy hydrocarbons from Iran.
In this situation, according to TankerTrackers, from January to March, China’s share of Iranian oil exports by sea increased from 29.3% to 42.6%.
“Iran’s debt to China is not as large as that of Venezuela, but Iran remains one of the largest oil suppliers, and Chinese companies are interested in working in Iran’s oil fields because Beijing is investing in some infrastructure projects in the Islamic Republic, so China is really providing economic support to its partners, offsetting US sanctions against these countries,” Michalkova explains.
In addition, according to Maslov, the active partnership with Iran and Venezuela in the energy sector is also directly related to the tense relations between China and the United States. According to the expert, even if the US and China sign a trade agreement and end the tariff war, Washington will continue to pressure Beijing. Therefore, China is trying to strengthen cooperation with its partners.
“China imports oil and gas mainly from Russia, the Persian Gulf countries and the United States, but the US can cut the supply of resources to China and negatively influence the supply of oil from the Middle East countries. is looking at alternative options for buying energy raw materials,” Maslov said.