September Update on Iran’s NITC Tankers

Iran’s recorded crude exports fell in September to the lowest since July 2016, although China remains the one big outlier and principal purchaser, having imported an average of 171,000 barrels per day over the month. Overall, it seems like good news for U.S. authorities trying to reduce Iranian oil exports to “zero.”

However, “recorded” is the operative word, because vast quantities of Iranian oil continues to find their way around the world untracked. Of 65 sanctioned tankers tracked by UANI, 36 failed to signal their locations using Automatic Identification System (AIS) at all during September.

In other words, Iran’s fleet continues to play the dangerous cat and mouse game of evading trackers, accountability, and sanctions. Iran’s National Iranian Tanker Company (NITC) acts as the overall coordinator, directing all vessels. It is then left to the experience of each vessel captain to decide where and when to manipulate the AIS. A legitimate ship going about regular commerce does not switch off its AIS because such information is crucial in avoiding collisions.

For some of Iran’s sanctioned vessels that did signal intermittent positions, we can try to fill in the gaps. For instance, the Iranian Very Large Crude Carrier (VLCC) DORE (IMO: 9357717) was spotted carrying 1.7 million barrels of crude oil. On September 14, DORE appeared in the Strait of Malacca with a draft (measuring how high a vessel is in the water and a proxy for how much cargo is on board) of 19.01. DORE’s AIS signaled its destination as Taiwan. This was an unusual destination to signal since it is doubtful Taiwan would openly import Iranian oil during sanctions.

The next day, on September 15, DORE turned off its AIS transponder. Five days later, on September 20, DORE reappeared off the coast of Hong Kong empty, reporting its draft at 11.5 and signaling its destination as the Chinese mainland Port of Huizhou. We can speculate that DORE discharged its contents at Huizhou, a frequent destination for Iranian oil tankers and owned by CNOOC.  On September 30, DORE reappeared again, this time off the coast of Singapore, still empty and signaling for Fujairah, in the UAE.

(Sources: Bloomberg L.P., Mapbox, OpenStreetMap)

Similarly, in September, the Iranian VLCC tanker DERYA (IMO: 95699700) appeared in the Strait of Malacca on September 16, full with a draft at 19 and signaling its destination as the Chinese port of Ningbo-Zhoushan. It then “went dark” on September 17, 2019, for over two weeks. On October 3, 2019, DERYA reappeared in the Strait of Malacca empty with a draft at 11.5, suggesting it likely completed the delivery of its contents to the Chinese port of Ningbo-Zhoushan and is returning to Iran.

(Sources: Bloomberg L.P., Mapbox, OpenStreetMap)

Another notable event occurred in September involving the Iranian tanker SALINA (IMO: 9357377) after it returned to Iran after completing its delivery to Jinzhou, China. On September 17, SALINA carried out a Ship-to-Ship (STS) transfer of oil from the permanently stationed Floating, Production, Storage and Offloading vessel (FPSO) CYRUS, which produces oil from the South Pars Oil & Gas field. According to publicly available ship tracking data, oil has not left the FPSO CYRUS in over two years. After completing the STS transfer SALINA indicated for Assaluyeh, Iran. UANI will continue to track this cargo to its final destination.

(Sources: Bloomberg L.P., Mapbox, OpenStreetMap)

Other vessels that may be carrying Iranian crude or fuel oil that have updated their location in September include: SAVIOR (IMO: 9173745) – The SAVIOR loaded in Iran on April 27 and is currently anchored off the coast of Syria. On September 29 SAVIOR turned its AIS on indicating its destination as Port Said, Egypt and the vessel now empty with its draft at 8. It is possible this vessel delivered oil to Syria.

(Sources: Bloomberg L.P., Mapbox, OpenStreetMap)

SERENA (IMO: 9569695) – The SERENA was last seen empty on May 20, anchored in China. On September 25, SERENA reappeared after four months, still empty and signaling its destination as Shanghai. This sudden signal of its AIS transponder after such a long time off may indicate the vessel is getting ready for another load or delivery.

(Sources: Bloomberg L.P., Mapbox, OpenStreetMap)

China continues to import oil and petroleum products from Iran. In late September 2019, the U.S. slapped sanctions on six Chinese firms, including two subsidiaries of Chinese giant COSCO, for knowingly violating restrictions on handling and transacting Iranian petroleum. All six are now featured on the Office of Foreign Assets Control (OFAC) website for the world to see and note.

This latest action has thrown the global oil shipping market into panic, with traders canceling bookings with sanctioned entities to OFAC action. Expect more U.S. sanctions on Chinese firms – without Chinese imports, the U.S. aim of getting to “zero crude exports” is firmly in sight.