The lawless floating gas station where Iranian oil changes hands

The oil tanker known as the MT Tifani made several trips between Iran and an area of ​​water off the coast of Malaysia, about 60 miles from Singapore’s flashy skyscrapers, in the year it was dramatically seized by US forces in the Indian Ocean.

During those trips, he often navigated a small area before dropping anchor and turning off his mandatory automatic identification system (AIS), according to MarineTraffic data reviewed by CNN.

After some time – sometimes hours, sometimes days – the ship would reappear on the AIS.

Tuesday’s seizure of the MT Tifani and 1.9 million barrels of Iranian oil that US officials said it was carrying pushed the war with Iran into Indo-Pacific waters thousands of kilometers from the Persian Gulf.

It also sheds light on this stretch of water off the coast of Malaysia, roughly half the size of Rhode Island; Experts and CNN analysis show that it served as a floating gas station for Iran, used by its stay-behind fleet to trade and store oil and funneling desperately needed cash to the regime as the war progressed.

Although not officially defined, the area is commonly known as the Eastern Outer Port Limits (EOPL) anchorage. It is located approximately 43 miles off the coast of peninsular Malaysia in the country’s exclusive economic zone (EEZ), near the eastern entrance of the Singapore Strait, one of the world’s busiest shipping lanes. This situation is most visible in satellite images, where hundreds of ships navigate the region from time to time.

MT Tifani can also be identified by its IMO number: 9273337. The number assigned by the International Maritime Organization cannot be changed regardless of ownership or flag.

On one occasion last August, unspecified cargo was seen being unloaded in this area onto another ship called the Macho Queen (IMO: 9238868), according to satellite images reviewed by CNN. After the transfer, the Macho Queen briefly turned on her AIS and began sailing northeast towards China, then turned off her tracker again after the US imposed sanctions for smuggling Iranian oil to China.

A second oil tanker, MT Majestic

Farzin Nadimi, a senior fellow at the Washington Institute think tank who specializes in Iran, said EOPL is a hot spot for the stay-behind fleet because of its convenient location and the tolerant attitudes of nearby officials.

“It’s a very convenient place to hide activities,” Nadimi said. “Malaysian officials are basically looking elsewhere.”

There were at least 679 ship-to-ship transfers at EOPL in 2025, with 471 in 2024 and 280 in 2023, according to satellite data compiled by the nonprofit United Against Nuclear Iran (UANI). These figures underestimate the true picture due to the fact that the satellite does not pass every day and cannot detect ships in bad weather conditions.

CNN has reached out to the Malaysian government for comment.

Last July, Malaysia vowed to step up enforcement against illegal ship-to-ship transfers in its waters, while Foreign Minister Mohamad Hasan acknowledged the problem was “a nuisance from our perspective,” state media Bernama reported.

According to Bernama, Mohamad said that under the new regulations, any ship caught making unauthorized transfers will be detained.

“We no longer want to be accused of being a country that facilitates such activities,” he said.

Iran is one of the world’s largest oil producers, exporting an average of 1.69 million barrels per day in 2025, according to trade data and analysis company Kpler. According to the US government, approximately 90% of oil goes to China. China did not impose sanctions on Iranian crude oil and declared that it was against sanctions on Iranian oil.

Because of widespread sanctions, Iran relies on a fleet of aging tankers with opaque records and spotty insurance to transport its crude around the world.

According to energy data company Vortexa, the bulk of the shadow fleet consists of Very Large Crude Carriers (VLCCs); Huge tankers like MT Tifani, which can carry up to 2 million barrels of oil.

Most of the sanctioned oil is sold at a discount of about $10 to the global benchmark Brent crude, which has risen to more than $100 a barrel since the start of the war; This means that each ship-to-ship transfer generates tens of millions of dollars in revenue for the Iranian regime.

Activity at EOPL has continued since the United States and Israel declared war on Iran in late February, restricting the flow of oil from the Middle East. UANI tracked at least 250 ship-to-ship transfers at the EOPL anchorage between January and 21 April this year.

Iran’s use of this region allowed it maintaining a steady flow of exports He financed the regime throughout the war, even as the world struggled with a severe oil shortage.

“This is very important to Iran’s business model,” said UANI senior advisor Charlie Brown, focusing on Iran’s shadow fleet.

How does the ‘cargo laundering business’ work?

Ship-to-ship transfers are a routine part of legitimate long-distance transportation and are used to increase efficiency and avoid ports.

Large oil tankers often offload their cargo onto smaller ships because their drafts are too deep to enter most ports. However, since these maneuvers carry safety and environmental risks, they are subject to strict regulations and must be carried out in approved areas, requiring comprehensive documentation and notification of coastal authorities.

Shadow fleets use ship-to-ship transfers to conceal the source of the oil they transport, even if it is logistically unnecessary. They often conduct them under cover of night, turning off or spoofing their AIS, making it difficult for authorities to detect them.

Generally speaking, Iran’s shadow oil trade follows a similar path; It includes two groups of ships that help transport Iranian crude oil to China.

Ships from the first set primarily pick up oil from Kharg Island, Iran’s main export facility, and cross the Indian Ocean via the Malacca and Singapore straits before anchoring off the coast of Malaysia.

Ships from the second group then pick up the oil via ship-to-ship transfer and take it to China, particularly to its “teapot” refineries in Shandong province, which is known for its sanctioned crude purchasing.

Kpler crude oil market analyst Ying Cong Lah said China does not officially declare its crude oil imports from Iran and often conceals that the oil originates from Malaysia.

CNN has reached out to China’s foreign ministry for comment. Earlier this month, a ministry spokesman said Beijing “opposes unilateral sanctions that have no basis in international law” when asked about the US assessment that China would not stop buying Iranian oil.

Brown, UANI’s senior advisor, said that most of the ships carrying oil from Iran to Asia have been blacklisted by the United States, while the majority of ships taking oil to China have not yet been approved.

Shadow fleets also forge documents and send false flags or “flags of convenience”, frequently changing their registration and misrepresenting their cargo to authorities.

“They create a new narrative for the new cargo and the new ship,” said Nadimi of the Washington Institute, adding that crews sometimes go as far as: paint a new name or flag on board. “This is a cargo laundering business.”

Nefarious activities at EOPL have long remained an open secret in the maritime industry. Brown estimates that about 95 percent of ships carrying cargo in the region are smuggling Iranian or Russian oil to China.

Strategic reserve close to China

Nadimi said the EOPL also serves as a form of oil storage for Iran and acts as a buffer against any disruption to shipping traffic in the Persian Gulf.

“There is a risk of conflict in the Strait of Hormuz in the Gulf region, so Iran prefers to transport cargo, crude oil, as close to its customers as possible.”

According to Kpler, Iran had a record 191 million barrels stored offshore in February; the vast majority of these were in East Asia.

Even as the United States and Israel pounded the country throughout March, this volatile strategic reserve allowed Tehran to maintain high exports, shipping an average of 1.1 million barrels a day to China, according to UANI. Although there was a decline in typical export figures, the rise in oil prices helped offset the financial blow suffered by the regime.

MT Tifani may have been on its way to unload cargo at EOPL when it was boarded by US forces.

In the month before its seizure, the ship lingered around the Strait of Hormuz and the Persian Gulf, according to MarineTraffic data. Although the tanker’s AIS was turned off, CNN was able to locate the tanker docked near Iran’s Kharg Island in satellite images taken on April 6.

The tanker reappeared on the AIS on 10 April when it was spotted heading southeast in the Gulf of Oman. MarineTraffic data showed the plane was heading towards Singapore.

On 21 April, the tanker made a sudden change of course after passing Sri Lanka; It first made a sharp 90-degree turn to the south, and then another sharp 90-degree turn to the east. Shortly after the ship made these route changes, the USA announced that the ship was seized.

In a video released by the Department of Defense, US forces can be seen on MT Tifani as helicopters circle overhead.

MT Tifani has been roaming the area ever since.

CNN’s Steven Jiang contributed reporting.

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