LONDON: Iran’s crude exports to China have fallen sharply since the start of the Ukraine war as Beijing favoured heavily discounted Russian barrels, leaving almost 40 million barrels of Iranian oil stored on tankers at sea in Asia and seeking buyers.

US and European sanctions imposed over Moscow’s invasion of Ukraine on Feb. 24 have pushed more Russian crude east, where China has snapped it up, cutting demand for oil from Iran and Venezuela, which are also both under Western sanctions.

About 20 vessels with oil from Iran were at anchor near Singapore as of mid-May, shippers’ data showed.

Some tankers have been anchored since February but the number storing Iranian oil climbed swiftly since April, trading and shipping sources said, as more Russian oil headed east.

Kpler data and analytics company said it estimated the amount of Iranian oil in floating storage near Singapore rose to 37 million barrels in mid-May from 22 million barrels in early April.

The United States banned imports of Russian oil shortly after Moscow’s invasion, while the European Union is considering a phased embargo, pushing more Russian oil cargoes towards Asia.

“Russia can switch almost half of its exports to southeast Asia, especially China ... and that is a huge potential threat for Iranian crude exports,” Hamid Hosseini, board member of Iran’s Oil, Gas and Petrochemical Products Exporters’ Union in Tehran, told Reuters.

Iran, whose oil industry has struggled for years under US sanctions imposed over Tehran’s nuclear work, has long relied on Chinese oil purchases to keep the economy afloat.