Iran’s Floating Oil Reserves in Asia Exhausted Under US Blockade: Kpler

Iran exhausted its floating crude reserves in Asian waters by mid-October, according to energy analytics company Kpler, stripping Tehran of a financial buffer that had sustained sales to China during a U.S. naval blockade.

The stockpile allowed Iran to keep earning export revenue even as restrictions blocked fresh shipments.

With those supplies depleted, Tehran faces greater pressure on its government finances and access to foreign currency.

“There’s no more oil to discharge to China anymore,” Homayoun Falakshahi, Kpler’s head of crude-oil analysis, told The Wall Street Journal.

A Shrinking Export Buffer

Iran held about 135 million barrels overseas when the war began in February, Kpler estimates.

Much of that crude was stored aboard tankers near Malaysia and Singapore, with its value likely reaching $10 billion or more after oil prices rose.

Those waters served as both a storage hub and a transfer point.

Iran-linked vessels delivered crude to other tankers, which carried it onward to Chinese refineries, complicating efforts to trace shipments and enforce sanctions.

The U.S. first imposed its blockade in April. Iran continued supplying customers from the overseas stockpile, drawing down reserves as replacement cargoes were restricted.

A suspension of the blockade during peace negotiations in mid-June allowed Tehran to replenish supplies. Washington reinstated the restrictions in mid-July.

The rebuilt stockpile peaked at nearly 90 million barrels before falling below 1 million barrels by October 5, according to Kpler.

The company says the remaining supplies have since been exhausted.

Buyers Seek Other Suppliers

Other tracking organizations also recorded steep declines, although their estimates differed.

Vortexa analyst Emma Li put Iranian crude stored off Singapore at about 6 million barrels on October 9.

Chinese refiners were increasingly seeking supplies from Brazil and West Africa, she said.

United Against Nuclear Iran, an advocacy group, estimated that floating reserves in Southeast Asia had dropped to 10 million barrels or less by early October.

It said the precise volume was difficult to establish and stopped short of confirming complete depletion.

The disappearance of stored crude will not immediately eliminate all income from earlier shipments.

Chinese payments can take about two months to reach Iran, analysts say, leaving some receipts outstanding.

Pressure on Government Finances

Oil sales account for roughly 30% to 40% of Iranian government revenue and provide its largest source of foreign exchange, according to Falakshahi.

The Iranian currency has lost a third of its value against the dollar since early July, adding to inflation as the country contends with widespread shortages.

U.S. Central Command said Saturday that the blockade had deprived Tehran of at least $25 billion in oil revenue.

It argued that the losses would constrain Iran’s ability to rebuild factories and replenish weapons.

Iran has sought alternatives, including moving crude by truck to neighboring countries and using derelict tanks for storage.

Analysts say overland exports cannot replace the volumes previously transported by sea.

Tehran nevertheless rejects predictions of economic collapse.

Central bank governor Abdolnaser Hemmati told an International Monetary Fund meeting in Bangkok last week that the economy had remained resilient despite the pressure.