Iran Uses Ghost Fleet to Smuggle Oil to China

The government of Iran continues to export crude oil to China by employing a ghost fleet of sanctioned tankers. To evade international sanctions, Iranian vessels perform ship-to-ship transfers in a strategic hub located approximately 100 kilometers southeast of the Malay Peninsula, near Singapore and Malaysia. These operations allow Iran to launder cargoes by manipulating GPS data and using opaque ownership structures to disguise the oil's origin.

Since March 1, at least 37 Iran-linked tankers have transferred 62.3 million barrels of crude in the region. The shipments are primarily destined for China's Jiangsu, Liaoning, and Shandong provinces. These clandestine activities persist despite a Middle East war and shifting U.S. policy. The operations rely on the ability to mask the identity of vessels and the nature of the cargo during the transfer process, effectively decoupling the oil from its point of origin at sites like Kharg Island.

The United States government has maintained a contradictory approach to these exports, issuing a temporary authorization for the sale of pre-existing oil stocks that expired on April 19, while simultaneously implementing a blockade of Iranian ports beginning April 12. Despite these enforcement measures and the blockade, the ghost fleet remains operational, continuing to move millions of barrels of crude into Asian markets through the Southeast Asian corridor.