In the waters off Malaysia, Iranian oil sales continue despite blockade

A major anchorage area off Malaysia's coast has long functioned as an unofficial marketplace for sanctioned oil from Iran, Russia, and Venezuela. Recent satellite tracking reveals that Iranian crude continues flowing through this region despite a US naval blockade of Iranian ports that operated from mid-April through mid-June and resumed in mid-July. The Iranian tanker Humanity exemplifies this pattern: after transiting major shipping straits, it disabled its automatic identification system upon reaching the Eastern Outer Port Limits, a 1,200-square-kilometre expanse in the South China Sea approximately 70 kilometres offshore. Maritime security analysts indicate the vessel likely conducted a ship-to-ship transfer of its cargo, with the crude ultimately destined for China, which historically purchases roughly 90 percent of Iran's crude exports. A Stanford University-affiliated maritime security project has identified 62 vessels broadcasting false or decommissioned identities since the year's start while moving between the Gulf, the Malaysian anchorage, Hong Kong, and northern China. These ships operate as middlemen facilitating sales to China's independent "teapot" refineries, which face less exposure to US financial systems than state-owned enterprises and therefore prove more willing to purchase discounted sanctioned Iranian oil. The anchorage's strategic location—calm waters positioned between nearby suppliers in Singapore and Malaysia yet outside Malaysian territorial jurisdiction—continues enabling these operations throughout the conflict.