Economic News

China beginning to focus on lifeblood of global economy in Trade War by halting oil purchases from U.S. in favor of Iran

While the ‘Iran Deal’ may in the end prove to be nothing more than a money laundering scheme that was propagated by President Obama and several European parties, there is very little support from most of the world in Donald Trump’s choosing to tear up the agreement and reinstitute new sanctions on the Middle Eastern state.  And when you couple in the Trade War that the President has decided to embark upon with China and other countries, it should not be surprising that the Far Eastern economy has decided to use Iran as a geo-political chess piece against the U.S. by allowing one of its primary oil refiners to halt the purchase of American oil and instead replace it with Iranian energy.

Dongming Petrochemical, an independent Chinese refiner, said it has halted crude purchases from the US and turned to Iranian imports amid escalating trade tensions between Beijing and Washington. 

Dongming Petrochemical has nearly 6,300 employees, total assets of 30 billion yuan ($4.5 billion) and the primary processing capacity is 15 million tons per year, according to the company website

Chinese authorities are reportedly planning to impose tariffs on US crude imports and replace them with oil from West Africa and the Middle East, including Iran. Beijing said it was not going to fall into line with US sanctions banning business with the Islamic republic. – Russia Today

Under President Trump, the U.S. has been working hard to ramp up their energy exports and in essence try to coerce both Europe and the Far East into buying their higher priced crude and LNG products.  And with America having very little else outside of agricultural and automotive products to export to the rest of the world, hitting the U.S. where it does have a surplus of goods (energy), while at the same time giving the middle finger to Washington by doing business with Iran shows that China is not afraid of America’s economic and foreign policy gambit.  In addition, this move could even cause more OPEC nations to side with China by transferring over to their new oil market programs which will mean an even greater erosion of dollar hegemony.

Source: thedailyeconomist.com

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