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A report by Reuters has revealed that Iran has been using a secret trade mechanism over the past years, resembling barter, to circumvent U.S. sanctions and the international banking system. This mechanism involves transferring a portion of the revenue from oil sold to China into accounts used to purchase Chinese goods and services, as well as funding infrastructure projects and buying missile defense equipment worth millions of dollars last year. This approach is used to avoid paying for Iranian oil directly through international banks and allows China to continue importing over 80% of Iranian oil transported by sea in 2025 at discounted prices, while reducing its exposure to sanctions. The amount of funds transferred through this mechanism is estimated to range between two billion and 2.5 billion dollars in 2025. It has been in operation since 2021 and is part of Iran and China's efforts to bypass U.S. sanctions and strengthen their economic relations.
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