In the year leading up to its dramatic seizure by US forces in the Indian Ocean, the oil tanker known as the MT Tifani made several trips between Iran and a stretch of water off the coast of Malaysia, around 60 miles from the glitzy skyscrapers of Singapore.
During these trips, it often loitered in a small area before dropping anchor and switching off its mandatory automatic identification system (AIS), according to MarineTraffic data reviewed by CNN.
A while later — sometimes hours, sometimes days — the ship would reappear on AIS.
The seizure of the MT Tifani on Tuesday — and the 1.9 million barrels of Iranian oil US authorities say it was carrying — has pushed the war with Iran into the waters of the Indo-Pacific, thousands of miles from the Persian Gulf.
It’s also put a spotlight on this patch of water off Malaysia, roughly half the size of Rhode Island, which expert and CNN analysis shows acts as a floating gas station for Iran, used by its shadow fleet to trade and store oil, funneling desperately needed cash to the regime as the war grinds on.
While not officially defined, the area is commonly known as the Eastern Outer Port Limits (EOPL) anchorage. It lies near the eastern entrance to the Singapore Strait, one of the world’s busiest shipping pathways, about 43 miles off the coast of peninsular Malaysia, in the country’s exclusive economic zone (EEZ). It’s most visible on satellite imagery where, at times, hundreds of vessels can be seen loitering in the area.
The MT Tifani can also be identified by its IMO number: 9273337. Assigned by the International Maritime Organization, the number cannot be changed regardless of ownership or flag.
On one occasion last August, it was seen inside this zone offloading unspecified cargo to another vessel called the Macho Queen (IMO: 9238868), according to satellite images reviewed by CNN. After the transfer, the Macho Queen briefly turned on its AIS and began sailing northeast toward China, before turning its tracker off again after the US sanctioned it for smuggling Iranian oil to China.
A second oil tanker boarded and seized by the US Thursday, the MT Majestic X, had also traveled between the Middle East and the Singapore Strait toward the EOPL several times, according to MarineTraffic data.
The EOPL is a hotspot for the shadow fleet because of its convenient location and the permissive attitudes of nearby authorities, said Farzin Nadimi, a senior fellow with the Washington Institute think tank, specializing in Iran.
“It’s a very convenient place for hiding activities,” Nadimi said. “Malaysian authorities basically look elsewhere.”
At least 679 ship-to-ship transfers took place in the EOPL in 2025, up from 471 in 2024 and 280 in 2023, according to satellite data compiled by nonprofit United Against Nuclear Iran (UANI). These numbers underestimate the true picture because the satellite does not pass every day and can’t detect ships in bad weather.
CNN has reached out to the Malaysian government for comment.
Last July, Malaysia pledged to ramp up enforcement against illegal ship-to-ship transfers in its waters, with Foreign Minister Mohamad Hasan admitting the issue is “a thorn in our side,” state media Bernama reported.
Under new regulations, any vessel caught conducting an unauthorized transfer would be detained, Mohamad said, according to Bernama.
“We no longer want to be accused of being a country that facilitates such activities.”
Iran is one of the world’s top oil producers, exporting an average of 1.69 million barrels per day in 2025, according to trade data and analytics company Kpler. Roughly 90% of its oil goes to China, according to the US government. China has not sanctioned Iranian crude and says it opposes sanctions on Iran’s oil.
Because of the widespread sanctions, Iran relies on a fleet of aging tankers with opaque records and spotty insurance to move its crude around the world.
Most of its shadow fleet consists of Very Large Crude Carriers (VLCCs), according to energy data firm Vortexa — massive tankers like the MT Tifani which can hold up to 2 million barrels of oil.
Much of its sanctioned oil sells at a discount of about $10 less than the global benchmark Brent crude, which has surged above $100 per barrel since the war began, meaning each ship-to-ship transfer nets tens of millions of dollars in revenue for Iran’s regime.
The activity in the EOPL has continued since the US and Israel launched their war on Iran at the end of February, restricting the flow of oil from the Middle East. UANI tracked at least 250 ship-to-ship transfers in the EOPL anchorage between January and April 21 of this year.
Iran’s use of this area has allowed it to maintain a steady flow of exports throughout the war, bankrolling the regime even as the world contends with a severe oil shortage.
“It’s essential to Iran’s business model,” said Charlie Brown, senior adviser to UANI, focusing on Iran’s shadow fleet.
Ship-to-ship transfers are a routine part of legitimate long-haul shipping, used to boost efficiency and avoid ports.
Large oil tankers frequently offload their cargo to smaller ships because their draft is too deep to enter most ports. But because these maneuvers carry safety and environmental risks, they are highly regulated and must be done in approved areas, requiring thorough documentation and notification of coastal authorities.
Shadow fleets use ship-to-ship transfers, even when logistically unnecessary, to obscure the origin of the oil they are carrying. They frequently conduct them under the cover of night, shutting off or spoofing their AIS, making them difficult for authorities to detect.
Broadly speaking, Iran’s shadow oil trade follows a similar pattern, involving two sets of ships that help deliver Iranian crude to China.
Ships from the first set pick up the oil, mainly from Iran’s primary export facility Kharg Island, and sail across the Indian Ocean through the Malacca and Singapore straits, before anchoring off Malaysia.
Ships from the second set then receive the oil by ship-to-ship transfer and take it to China, mainly to “teapot” refineries in Shandong province, which are known for buying sanctioned crude.
China does not officially declare Iranian crude imports and often obscures the origin of the oil as Malaysian, said Ying Cong Lah, a crude-oil market analyst at Kpler.
CNN has reached out to China’s foreign ministry for comment. Earlier this month, a ministry spokesperson said Beijing “opposes unilateral sanctions that have no basis in international law” when asked about a US assessment that China would not stop buying Iranian oil.
Most of the ships ferrying oil from Iran to Asia are blacklisted by the US, while the majority of vessels picking up the oil and taking it to China are not yet sanctioned, said Brown, the UANI senior advisor.
Shadow fleets also forge documents and fly false flags or “flags of convenience,” frequently changing their registration and misrepresenting their cargo to fool authorities.
“They create a new narrative for the new cargo and the new ship,” said Nadimi of the Washington Institute, adding that crew sometimes go as far as to paint a new name or flag on the ship. “This is a cargo laundering business.”
Nefarious activity in the EOPL has long been an open secret in the shipping industry. Brown estimates about 95% of vessels transferring cargo in the area are smuggling Iranian or Russian oil to China.
The EOPL has also served as a kind of oil storage site for Iran, helping to cushion against any disruption to shipping traffic in the Persian Gulf, Nadimi said.
“There is a risk of hostilities breaking out in the Strait of Hormuz in the Gulf area, so they (Iran) prefer to move as much cargo, crude oil, as close to their customers as possible.”
Iran had a record 191 million barrels stored at sea in February, the vast majority in East Asia, according to Kpler.
This floating strategic reserve has allowed Tehran to maintain high exports, shipping an average of 1.1 million barrels per day to China even as the US and Israel pounded the country with strikes throughout March, according to UANI. While a dip from its typical export numbers, the surge in oil prices has helped to offset the financial hit to the regime.
The MT Tifani may have been on its way to offload cargo in the EOPL when it was boarded by US forces.
In the month leading up to its seizure, the vessel lingered around the Strait of Hormuz and the Persian Gulf, according to MarineTraffic data. Although the tanker had its AIS shut off, CNN was able to locate the tanker docked at Iran’s Kharg Island in satellite imagery taken on April 6.
The tanker reappeared on AIS on April 10, when it was spotted in the Gulf of Oman traveling southeast. MarineTraffic data showed it was heading toward Singapore.
On April 21, after passing Sri Lanka, the tanker made an abrupt course change — first a sharp 90-degree turn southward, then another sharp 90-degree turn back east. Shortly after the ship made these course changes, the US announced its seizure.
In a video posted by the Department of Defense, US forces can be seen onboard the MT Tifani as helicopters circle above.
The MT Tifani has been loitering in the area since.
CNN’s Steven Jiang contributed reporting.
