China’s Sinopec Plans to Skip Iranian Oil, Tap Strategic State Reserves
March 23, 2026
China's state-run refiner Sinopec does not intend to buy Iranian oil but is pushing for permission to tap state reserves, a senior executive said on Monday, days after the U.S. waived sanctions for buyers of some Iranian crude.
The world's largest refiner is particularly exposed to the near-closure of the Strait of Hormuz because it sources roughly half of its crude oil needs from the Middle East. Sinopec is buying Saudi oil from Yanbu and sourcing from outside the Middle East, the executive said.
To ease the global supply crunch, U.S. Treasury Secretary Scott Bessent issued a 30-day sanctions waiver on Friday for any Iranian oil already at sea, hoping to bring about 140 million barrels of oil to global markets.
However, buying that crude is complicated due to questions about how to pay for it, given financial sanctions on Iran are still in place, as well as the fact that much of it is aboard aging shadow fleet vessels.
Sinopec President Zhao Dong said on Monday the refiner was evaluating the risks and "basically won't buy" Iranian oil. Chinese refiners already buy most Iranian oil, however only private players participate in the sanctioned trade.
China maintains massive oil reserves and Sinopec was proactively seeking government support to tap them, the executive also said. Reuters reported earlier this month that Beijing had rejected a request to access 13 million tons.
The refiner would cut runs by 5% this month because of the disruption, Zhao said. Reuters also reported earlier this month that run cuts could exceed 10% in March.
(Reuters - Reporting by Aizhu Chen; Editing by Jacqueline Wong, Alexandra Hudson)
