China's Hengli Petrochemical Scraps Crude Purchases and Cuts Output After U.S. Sanctions
China's Hengli Petrochemical has cancelled recent purchases of crude oil cargoes from West Africa and the Middle East, forcing the refiner to cut production output, Reuters reported Thursday. The cancellations come just weeks after the company acquired the cargoes, which trade sources indicated were bought to demonstrate compliance and seek removal from the U.S. sanctions list.
The operational shift reflects the immediate impact of Washington's secondary sanctions, which were imposed on Hengli last year for allegedly purchasing Iranian crude. According to the Reuters report, five trade sources stated that the forced cancellations have left the firm with depleted inventories, mandating further reductions in refinery operations. The development highlights how sanctions targeting Iranian oil exports are tightening supply chains and squeezing logistics for major Chinese refiners.
From the sources (2 posts)
@staunovo#China's Hengli Petrochemical, sanctioned by the U.S. for allegedly buying Iranian oil, has cancelled recent purchases of non-Iranian crude, five trade sources said, forcing the firm to cut refinery operations further as inventory runs low
@reutersEXCLUSIVE: China's Hengli scraps West African, Mideast oil purchases and cuts output, sources say