By Bruce Stanley and Manus Cranny on 1/14/2019
Abouzar production platform. Photo: NIOC.
DUBAI and LONDON (Bloomberg) — The U.S. plans to grant no new waivers to buyers of Iranian oil as it intensifies efforts to eliminate the Middle Eastern producer’s exports of crude, a senior official said.
U.S. sanctions have so far cut Iran’s exports to about 1 MMbopd from a level of 2.7 MMbbl before Washington announced sanctions on the country. Of the eight buyers that secured initial U.S. waivers to buy oil from Iran, only five are still doing so, Brian Hook, the State Department’s special representative for Iran, said in an interview.
“We are not looking to grant any new waivers — that’s been our policy from the beginning,” Hook said. “We’ve been able to achieve a lot of economic pressure on Iran. Eighty percent of their revenues come from oil exports. We want to deny the Iranian regime the revenue that it uses to destabilize the Middle East.”
The U.S. withdrew from the Iran nuclear accord in May and imposed sanctions targeting the country’s sales of oil, its economic lifeblood. U.S. President Donald Trump accused Iran of sponsoring terrorism and seeking to develop nuclear weapons technology, and he has marshaled support in the Middle East and beyond to isolate the nation economically. Tehran maintains that it seeks atomic power solely for civilian purposes.
Hook confirmed that he met with Saudi Energy Minister Khalid Al-Falih in Vienna in December as OPEC members convened in the Austrian capital to assess the group’s output policy. Hook’s talks with Al-Falih were a part of “regular consultations that we’ve had ongoing.” Saudi Arabia, the biggest producer in the Organization of Petroleum Exporting Countries, is a regional rival of fellow OPEC member Iran.
“We have been pretty public about working with oil producers to ensure while we take off a lot of Iranian crude that we don’t lift the price of oil,” Hook said.
He declined to specify a target date completely eliminating Iran’s exports. “We have to balance our national security interests against our economic interests, and so far we’ve been able to do that very successfully.”
The U.S. gave six-month waivers running through April to Japan, South Korea, India, China, Taiwan, Turkey, Italy and Greece. Hook didn’t identify the three buyers that have stopped importing Iranian oil.
The State Department official said he was in daily contact with his European counterparts about the sanctions on Iran.
“There’s a lot more to come,” he said. “We’re going to continue our path to get to zero.”
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