U.S. Adds Chinese Oil Major and Shipping Line to Military Blacklist | OilPrice.com

China’s state oil major CNOOC and shipping line Cosco were added to a military blacklist compiled by the United States for ties between Chinese businesses and the People’s Liberation Army.

The black list, Bloomberg noted in a report on the news, classifies companies with ties to the Chinese army as military companies, and while such a status carries no sanctions, the federal government discourages U.S. companies from doing business with them, potentially affecting the businesses on the blacklist.

This is not the first time the U.S. government has targeted both CNOOC and Cosco. Back in 2019, Cosco was slapped with sanctions for carrying Iranian crude although a year later the sanctions were lifted. CNOOC was also sanctioned, in 2021, and put on a Pentagon blacklist.

CNOOC has interests in several onshore and offshore oil and gas projects in the United States but getting blacklisted by the Pentagon could make keeping these interests problematic, as suggested by the company itself recently.

CNOOC, which specializes in offshore oil and gas developments in China and internationally, booked a net profit of $5.2 billion (36.93 billion Chinese yuan) for the third quarter, up by 9% compared to the same period of 2023.

CNOOC focuses on oil and gas exploration and production and, unlike the other major Chinese state-owned oil giants such as PetroChina, it has much lower exposure to the refining sector, which has weighed this year on company profits amid weak refining margins and fuel demand.

The rise in CNOOC’s net profit was mostly attributed to record-high production and cost controls, more than offsetting weaker oil prices on international markets, which have reflected weaker Chinese oil demand than previously expected.

Cosco is a major tanker operator, with more than 40 tankers in its fleet, including close to 30 VLCCs, commonly known as supertankers.

By Charles Kennedy for Oilprice.com

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