Two of China’s largest state-owned oil companies are weighing whether to buy Iranian crude for the first time in seven years. Sinopec and PetroChina, which stopped importing Iranian oil in May 2019 to avoid US sanctions exposure, are now reconsidering that stance after a new US Treasury license opened a narrow window for legal transactions.

The 60-day general license, issued around late June 2026, permits the production, delivery, sale, and related services for Iranian oil through August 21, 2026. Neither company has confirmed any actual purchases yet, with both reportedly evaluating their compliance infrastructure before making any moves.

Why this matters for global oil markets

Independent Chinese refiners, the so-called “teapot” refineries scattered across provinces like Shandong, never really stopped buying Iranian crude. They used intermediaries and conducted transactions in yuan to stay below the sanctions enforcement radar.

China accounted for over 80% of Iran’s oil exports in 2025, averaging 1.38 million barrels per day. That volume came almost entirely through the independent refiner channel, not through state-owned giants like Sinopec and PetroChina.

A waiver, not a surrender

A similar waiver period occurred in March 2026, and Chinese state refiners declined to resume purchases at that time. The 60-day license is tied to ongoing diplomatic negotiations between the US and Iran. It’s a temporary easing of sanctions, not a complete policy reversal.

These are companies with global banking relationships, dollar-denominated transactions, and significant exposure to US regulatory enforcement. Independent teapot refiners, with their yuan-based transactions and limited international banking exposure, face different compliance risks. Broader Asian refiners show limited interest due to comfortable inventory levels across the region.

What this means for energy investors

Investors tracking energy markets should watch for two things: any confirmed purchase orders from Sinopec or PetroChina before the August 21 expiration, and any signals from the US Treasury about whether this waiver represents the beginning of a broader easing or a one-off diplomatic gesture.

The teapot refiners are expected to remain the primary purchasers of Iranian crude regardless of what happens with the waiver, given their established supply chains and yuan-denominated payment infrastructure.