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Iran’s secret supply of oil bound for China aboard its shadow fleet has finally dried up in the face of the US naval blockade on its ports, analysts said.
Iran has been able to power through US sanctions and a spiraling economy during the war thanks in part to its offshore stockpile carrying an estimated 135 million barrels of crude.
But the US blockade on Iran’s ports has prevented Tehran from replenishing its supplies, which shrunk to below 1 million barrels by Oct. 5 and is now virtually gone, according to the Kpler maritime analyst firm.
“There’s no more oil to discharge to China anymore,” Homayoun Falakshahi, head of crude-oil analysis at Kpler, told the Wall Street Journal.
The offshore oil allowed Tehran to reap billions from sales to China during the war to help offset record-high inflation in the country and record-low value of its rial currency.
US Central Command, which is operating the naval blockade, estimated that the regime has lost at least $25 billion worth of oil revenue due to the navy mission.
“With the exception of humanitarian assistance we’ve allowed in, Iran has no exports and no imports by sea,” Adm. Brad Cooper, head of CENTCOM, touted on Saturday.
“The sum total of these actions has imposed devastating costs on Iran’s security apparatus and the IRGC (Islamist Revolutionary Guard Corps) specifically,” Cooper added.
Oil sales represent about 30% to 40% of Tehran’s revenue and stands as its largest source of foreign exchange, Falakshahi said.
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Oil exports also generate about 60% of the money used to pay Iran’s government employees, including its military forces.
Experts have long warned that a plummet in oil sales would be the breaking block that could destabilize the regime and cause Iran’s elite class to finally suffer the economic woes its everyday citizens are experiencing as a result of the war.
Because it can take months for Chinese oil payments to flow into Iran, analysts say the regime has time before the money stops trickling in and forces the Islamic republic to make difficult decisions.
The fall in oil exports comes as oil flow out of the Strait of Hormuz and Gulf of Oman hit 82% of pre-war levels this past week, with 14 million barrels transiting the waters every day, according to Kpler.
Meanwhile, total oil exports out of the Persian Gulf hit an average of more than 24 million barrels a day, exceeding pre-war levels.
Iranian officials, however, reiterated their claim to the Strait of Hormuz and have remained adamant that the country can withstand as much pressure as necessary to force the US to concede in the war.