The stricken NITC tanker Sanchi has sunk off China a week after a collision with a CoscoCS bulker, with the loss of all 32 crew.
State-owned China Central Television said that the burning 164,000-dwt vessel (built 2008) had gone down on Sunday after "suddenly igniting" at 0400 GMT.
Iran's Tasnim news agency said flames had spread to new condensate tanks, creating a blaze as high as 100 metres and temperatures of 350 degrees Celsius.
It had been rocked by multiple explosions since the clash on 6 January.
The vessel drifted into Japanese waters before it sank. Japan's coast guard said the slick from its 136,000-tonne condensate cargo was covering an area measuring 13km by 11km.
But this was shrinking as patrol boats battled to contain the spill.
The fire on the sea surface has been extinguished.
Sanchi's last confirmed location was about 315km west of Sokkozaki on the island of Amami Oshima.
It is thought to be worst tanker spill since the ABT Summer lost 260,000 tonnes off Angola in 1991.
No survivors
Reuters cited an Iranian official as saying earlier on Sunday there was no chance any crew had survived.
"There is no hope of finding survivors among the members of the crew," said Mohammad Rastad, spokesman for the Iranian rescue team sent to Shanghai.
He added that two-thirds of the Iranian tanker was under water at the time.
The crew consisted of 30 Iranians and two Bangladeshis.
One body had been found last week, while two more were found in a lifeboat on Saturday.
Thirteen vessels and an Iranian commando unit had been taking part in the salvage operation, amid bad weather.
Rescue workers have retrieved the ship's black box, but had to leave the ship quickly due to heat and toxic smoke.
