China is pressuring Iranian officials to keep the Strait of Hormuz open, allow the passage of oil and LNG cargoes, and not attack tankers carrying energy supplies, anonymous senior executives at Chinese state energy firms told Bloomberg on Tuesday.
China depends on Middle East’s oil and LNG for a large part of its huge energy imports. But Iran is heavily dependent on Chinese refiners to buy its sanctioned oil, too, with over 80% going to China. All these supplies have to transit the Strait of Hormuz on their way to China from ports in the Gulf.
Iran on Monday claimed that the Strait of Hormuz has been closed, with Ebrahim Jabbari, a senior adviser to the Commander-in-Chief of Islamic Revolutionary Guard Corps (IRGC), quoted as saying that Iran would “attack and set ablaze any ship attempting to cross.”
The U.S. Central Command denies the Strait is closed, a senior U.S. military official told Fox News.
It is unlikely that Iran would mine the Strait, considering that about 80% of its oil exports need to pass through the narrow lane to go to China, according to the official.
Energy flows from the Middle East have already been severely disrupted, with oil tankers diverting away from the Strait of Hormuz, freight rates for supertankers en route to China at all-time highs, insurers ending war risk coverage for vessels transiting the Strait, and Qatar halting its LNG production.
China’s official statements on the war have been limited so far, with calls to end hostilities prevailing.
Still, Chinese Foreign Minister Wang Yi on Monday told Iranian Foreign Minister Abbas Araghchi that “China believes that under the current severe and complex situation, Iran can maintain social stability and pay attention to reasonable concerns of its neighboring countries.”
At a regular press conference on Monday, China’s Foreign Ministry Spokesperson Mao Ning said that “The Strait of Hormuz and its adjacent waters are an important international trade route for goods and energy.”
“China urges relevant parties to immediately stop military operations, avoid further escalation of the tense situation and prevent regional turmoil from causing greater damage to global economic growth,” the spokesperson said.
By Tsvetana Paraskova for Oilprice.com
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