Shadow Oil Trade Endures Near Singapore Despite War
Iran‘s shadow oil trade has continued near Singapore, despite the ongoing war in the Middle East, allowing Tehran to evade sanctions and maintain its trade with China.
The ageing vessels that make up Iran‘s “ghost fleet” operate clandestinely, exploiting opaque ownership structures, false flags, a lack of insurance, and manipulation of GPS data to keep a low profile. Ship-to-ship (STS) transfers on the high seas allow them to “launder” cargoes, disguising their origin.
Strategic Hub Emerges
An area off Malaysia and Singapore, about 100 kilometres southeast of the Malay Peninsula, has emerged as a strategic hub for moving Iranian crude. Each week, dozens of transfers between tankers – not only Iranian – can be seen from the air, an analysis of satellite imagery found.
“It’s really the main hub,” said Amir Handjani of the US-based Quincy Institute for Responsible Statecraft. He described the STS situation there as “total anarchy”.
Laundering Cargoes
These transfers have continued during the war, despite a temporary easing of US sanctions. On March 20, Washington authorised the sale of Iranian oil already stored on vessels before that date. The authorisation is due to expire on April 19.
But faced with “contradictory activities” by the United States – easing sanctions then blockading Iranian ports – “it’s safer to keep exporting Iranian oil using shadow vessels and then STS transfers than it is to try to export that oil legitimately,” said Elisabeth Braw, an expert at the Atlantic Council.
Destination China
Iranian tankers leave the Gulf via the Strait of Hormuz having loaded with crude, usually at Iran‘s strategic Kharg Island, according to analysis of several maritime tracking platforms. They then skirt the Indian subcontinent and pass through the Strait of Malacca to Singapore on a two- to three-week journey, before anchoring and waiting for another tanker to take their cargo.
Since March 1, at least 37 Iran-linked tankers have transferred their cargo at sea in the area, amounting to at least 62.3 million barrels of crude, according to data from maritime tracking firm Kpler analysed by AFP. When specified, the final destinations of these cargoes were ports in China’s northern provinces of Shandong, Liaoning, and Jiangsu.
Most of the vessels left the Gulf before war broke out on February 28, but at least six Iranian tankers – among 26 that have crossed the Strait of Hormuz during the conflict – have transferred their cargoes (totalling 10 million barrels) in recent weeks near Singapore. The Silvia 1 loaded one million barrels at Kharg in February, passed through the Strait of Hormuz on March 3, arrived in the Singapore area on March 21, and transferred its cargo around March 25 to
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