US Expands Sanctions on Iran to About 60 Entities, Impact on China's Oil Purchases Remains

On the 24th, the U.S. Treasury announced sanctions against approximately 60 individuals, entities, and vessels related to Iran. This action is part of an economic pressure campaign aimed at cutting off funding for the Iranian regime, with digital assets also included in the areas at risk of sanctions. The U.S. stated that the demand from China, the largest buyer of Iranian oil, remains a crucial variable for the effectiveness of the sanctions. China purchases about 90% of Iran's oil exports, with independent refiner Teapot Refinery handling most of it. The U.S. has not imposed comprehensive sanctions on major Chinese banks or corporations, seemingly considering trade relations with China. The Chinese Foreign Ministry responded by asserting that sanctions and pressure do not contribute to resolving the issue. The oil market did not experience an immediate supply shock, and Brent crude futures closed down 3.9% at $88.58. The number of offers for Iranian oil heading to China has shown a declining trend, interpreted as a signal of the pressure from sanctions. Currently confirmed facts include the expansion of the sanctions scope, China's backlash, falling oil prices, and a decrease in offers for Iranian oil to China.