Bloomberg News

Sinopec Imported Iran Crude at 2011 Levels in May, Official Says

June 12, 2012

China International United Petroleum & Chemical Co., the trading unit of the nation’s biggest oil refiner, has boosted monthly crude imports from Iran to levels similar to 2011, according to an official at the parent company.

Shipments from Iran received by the unit known as Unipec averaged 270,000 to 280,000 barrels a day in April and May, in line with last year, said the official at China Petroleum & Chemical Corp. (600028), who declined to be identified because of company rules. Imports fell in the first quarter after Unipec, which accounts for half of China’s crude purchases from the Persian Gulf nation, failed to agree on annual payment terms with National Iranian Oil Co.

China, the biggest buyer of Iranian crude, faces U.S. sanctions because of the purchases. India, South Korea, Turkey, South Africa, Malaysia, Sri Lanka and Taiwan were given six- month exemptions from the sanctions because they “significantly reduced” the volume they buy, U.S. Secretary of State Hillary Clinton said in a statement yesterday. Japan and 10 European Union nations were granted waivers in March.

U.S. President Barack Obama signed a bill on Dec. 31 that denies access to the U.S. financial system to any foreign bank that processes payments for Iranian oil. The sanctions are part of an attempt by Western nations to halt the Islamic Republic’s nuclear program. A European Union embargo that includes a ban on insuring tankers carrying Iranian crude takes full effect starting July 1.

Cargo Request

China imports crude from Iran based on its economic needs and its trading is “completely lawful and reasonable,” Liu Weimin, a Foreign Ministry spokesman, told a briefing in Beijing today.

Iran has asked to sell extra cargoes to China Petroleum, known as Sinopec, according to the official, who also said Sinopec rejected the offer. Chinese oil companies will be able to insure their ships carrying Iranian crude even after the European Union embargo starts, the official said, without elaborating.

Sinopec’s full-year purchases from the country will be about 20 percent less than last year because of the first- quarter drop, and China’s total deliveries from Iran will fall 15 to 20 percent, the official said.

China also imports Iranian crude via Zhuhai Zhenrong Co. Total deliveries rebounded to 390,000 barrels a day in April from 254,000 in March after the payment dispute was resolved, customs data show. China bought an average of 557,413 barrels a day from Iran in 2011, accounting for 11 percent of its total purchases.

To contact the reporter on this story: Winnie Zhu in Singapore at

To contact the editor responsible for this story: Mike Anderson at

Steve Ballmer, Power Forward
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