Iran Begins Barter Trade with China as the Danger of US Sanctions Loom

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An illustration of a handshake over the backdrop of a Chinese and Iranian flag.
An illustration of a handshake over the backdrop of a Chinese and Iranian flag.
(photo credit: Motortion Films/Shutterstock)

Iran has used a barter-like arrangement to bypass sanctions on its oil sales and buy billions of dollars’ worth of goods from China, including military gear, two senior Iranian sources and three other people familiar with the matter told Reuters.

The secretive trade mechanism, in which Iranian oil is exchanged for credits for Chinese imports, has provided a financial lifeline for Tehran in recent years as the United States stepped up economic and military pressure over its nuclear program, according to the sources, who spoke on condition of anonymity.

It has also helped China, the world’s biggest crude importer, retain access to discounted Iranian oil while shielding banks and companies that export to the Islamic Republic from international scrutiny or penalties, they said.

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