SINGAPORE, July 8, 2026, 22:02 (SGT)
- The U.S. swapped out Iran General License X for X1 on July 7, cutting off new purchases or loadings of Iranian crude. Only wind-down trades are allowed until July 17.
- Some 63 million barrels of Iranian oil are sitting on ships, about 40 days’ worth of China-bound Iranian crude and condensate flows projected by EIA for 2025.
- Brent gained 5.14% to trade at $77.97 a barrel by 1339 GMT, with the three-month Brent spread out to $2.36—a move traders took as tighter supply in the short term.
The end of the U.S. Iran oil waiver is leaving tankers loaded with crude and nowhere to go. Shipments have piled up, with tens of millions of barrels at sea. Sellers are facing a tight legal deadline to wrap up earlier deals, but a lot of this oil doesn’t have a set buyer yet.
Investor risk sits mostly in China. EIA data say Iran shipped out 1.576 million barrels a day of crude and condensate in 2025, with nearly all of it—1.567 million bpd—headed to China or routes probably going there. So the 63 million barrels now at sea are roughly 40 days’ worth of China shipments. At Brent’s intraday price, that’s about $4.9 billion for these barrels, not counting any discount from Iran.
| Sanctions clock | Previous waiver | New position |
|---|---|---|
| U.S. action | General License X came out June 22 | General License X revoked, X1 put in place July 7 |
| Trade allowed | Iranian crude, petrochemicals and petroleum sales, production, deliveries allowed through Aug. 21 | Wind-down only allowed through 12:01 a.m. EDT July 17 |
| New purchases/loadings | Permitted with the waiver | Banned starting July 7 |
| Payment condition | Broad waiver coverage | Any payment to blocked persons has to go to a blocked, interest-bearing U.S. account |
Banks and shippers are focused on OFAC’s statement saying new purchases and loadings aren’t allowed after July 7, according to X1. Before, the license had covered sales through Aug. 21.
Bloomberg, using Vortexa numbers, estimates there are about 63 million barrels of Iranian oil on the water, from the Persian Gulf out to Asia. Most of these vessels either have no clear destination or just say “for orders,” according to Bloomberg. United Against Nuclear Iran said it has tracked 19 Iranian oil and petrochemical shipments since the interim deal, and counted at least 46 loaded tankers near Iran. BusinessMirror
| Measure | Number | Investor read |
|---|---|---|
| Iranian oil now on water | 63 mln bbl | Big floating supply, but buyers, insurance and payments are a risk |
| Iran crude shipped since blockade pause | 60 mln bbl | Quick shipments loaded before waiver ended |
| Possible stuck crude/products if blockade resumes | ~50 mln bbl | TankerTrackers.com figure after tensions flared |
| EIA 2025 Iran exports to China/likely China-bound | 1.567 mln bpd | China is basically the main export exit |
| 63 mln bbl vs that 2025 China flow | ~40 days | More than a month of average Iranian flows to China |
Iran sent 60 million barrels of crude overseas after the US Navy paused its blockade in mid-June 2026, TankerTrackers.com told Oilprice. The group also estimated Iran may be left with “~50 million barrels” of crude and refined product if the blockade resumes. OilPrice.com
China Petroleum & Chemical Corp HKG:0386, or Sinopec, and PetroChina Co Ltd HKG:0857 have been studying options for shipping, insurance and payments to resume Iranian crude imports once the waiver is in place, Reuters said on June 25. According to the same story, teapot refiners are still the main buyers for Iranian oil. Iranian crude loadings hit about 1.6 million bpd between June 19 and June 24, up from 340,000 bpd in the first 18 days of June.
That market could be fading. China cut back refined fuel export limits for July, and Zhejiang Petrochemical Co, which is mostly owned by Rongsheng Petrochemical Co Ltd (SHE:002493), can export again after more than three months out. Refiners are looking at around 3 million metric tons of gasoline, diesel and jet fuel exports this month, Reuters said.
Shipping data point to a risk premium beyond just Iranian barrels. Reuters said at least four oil and gas tankers pulled out of Hormuz transits after recent vessel attacks. The Indian-flagged VLCC Lila Vadinar, loaded with 2 million barrels of Kuwaiti crude, turned back off Oman. Mangalore Refinery and Petrochemicals Ltd (NSE:MRPL) dropped its Iraqi crude charter, the report said.
Oil jumped. Brent climbed to the highest in two weeks and the Brent three-month timespread went back into backwardation, less than a week after trading in contango on July 6. “Fundamentally, oil should trade higher,” Ole Hvalbye at SEB Research said. Saul Kavonic, research chief at MST Marquee, said Trump’s remarks pointed to the “prospect of a re-closing of the Strait.” Reuters
Bob McNally, who runs Rapidan Energy Group, said the latest developments “signal that the ceasefire is not as solid and durable as the oil market has chosen to assume.” He said “the oil market has some risk pricing to do.” Reuters
With inventories drawn down, the floating Iranian barrels matter more than the headline numbers show. Reuters said July 6 that around 1 billion barrels came out of reserves during the supply shock, including 400 million barrels released by the IEA. When the war started, China had close to 1.4 billion barrels stored, topping the 1.2 billion barrels held by all 32 IEA members combined, even including the U.S. Strategic Petroleum Reserve.
John Baffes, senior economist at the World Bank, said traders saw the disruption as “serious but manageable” based on earlier market moves. Ilia Bouchouev at the Oxford Institute for Energy Studies said with thinner buffers, forward oil prices could see sharper spikes. According to Reuters, each $5 move up in oil adds about $190 billion a year in costs to the world economy. Reuters
