Washington warns Hong Kong to watch for vessel carrying Iranian oil

[HONG KONG] The United States has warned Hong Kong to be on alert for a vessel carrying Iranian petroleum that may seek to stop in the Asia financial hub, and said that any entity providing services to the vessel will be violating US sanctions.

The news comes nearly a month after US President Donald Trump's administration stepped up moves to choke off Iran's oil exports by scrapping waivers it had granted to big buyers of Iranian crude oil, including China.

The fully laden Pacific Bravo abruptly changed course on Monday to head towards Sri Lanka, according to shipping data on Refinitiv Eikon. The vessel had earlier identified Indonesia as its intended destination, according to ship-tracking data, but industry sources said it was most likely going to China.

The Pacific Bravo on Monday changed its automatic identification system (AIS) destination to Sri Lanka, where it meandered off the southern coast for a little more than a day, the ship-tracking data showed.

Late on Tuesday evening, the tanker sailed away from Sri Lanka towards the busy waterways of the Strait of Malacca, a key shipping lane towards East Asia, although its AIS destination was still set as Sri Lanka.

A ship's crew manually enters AIS destination settings, and there can be a delay in updates while the vessel is at sea.

"Anyone who does business with this ship, the Pacific Bravo, would be exposing themselves to US sanctions," a senior US official said on condition of anonymity.

The Pacific Bravo is owned by China's Bank of Kunlun, the official said. The bank has been the main official channel for money flows between China and Iran since before the last round of sanctions began in 2012. It is majority-owned by China National Petroleum Corp's listed financial arm, CNPC Capital.

China is the top buyer of Iranian oil and nearly all its oil payments go through Kunlun, which was established in 2006 as a city commercial bank in Karamay, an oil-producing hub in China's far-western Xinjiang region. Kunlun could not immediately be reached for comment.

Earlier this month, Reuters reported that a tanker carrying Iranian fuel oil in violation of US sanctions had unloaded the cargo into storage tanks near the Chinese city of Zhoushan.

The US government reintroduced sanctions against Iran's oil industry in November but allowed some buyers limited purchases of Iranian crude oil under a waiver program until May 1. Petroleum products had not received official sanctions waivers.

"I think it's critical for the Hong Kong Marine Authority to ensure it knows who it's allowing into its territorial waters, into the Hong Kong port, and to ensure that it knows who Hong Kong entities are providing services to," the US official said. "We're going to enforce our Iran sanctions quite aggressively and quite consistently."

The Hong Kong Marine Authority did not immediately respond to a request for comment.

REUTERS